In the early morning hours on Friday June 25th a congressional panel reached agreement on a sweeping overhaul of the financial system. The agreement now must go to the full Senate and House of Representatives for final votes and is expected to be on President Obama’s desk for signing by July 4th.
Major compliance issues include:
A new financial regulator, but only for institutions with assets exceeding $10 billion.
A restriction that prohibits lenders from making a loan without verifying that the borrower can repay it. Lenders would have to disclose the maximum amount that borrowers could pay on adjustable-rate mortgages and they would be barred from receiving incentives to push homebuyers into high-priced loans.
The new rules will prohibit mortgage brokers from steering customers into more expensive loans for a commission and will ban no-documentation loans. It will also make credit card statements more readable and transparent, allowing consumers to more easily compare products.
Once signed, the bill will move to the regulatory agencies for the drafting of regulations. In other words, nothing will happen immediately.
Stay tuned for further details.