Predatory Lending Rules Approved By Joint Committee Of Agency Rule Review
December 13, 2006
The Ohio Joint Committee of Agency Rule Review has approved the Attorney General's proposed rules for Senate Bill 185, the Homebuyers' Protection Act, designed to put a stop to the blight of predatory lending in Ohio, Attorney General Jim Petro said.
The rules will be officially filed this month and go into effect the beginning of January. They clarify unconscionable mortgage-lending practices identified by the General Assembly in S.B. 185. The rules contain information on methods loan officers, mortgage bankers, and non-bank mortgage lenders should use in determining a consumer's ability to repay a loan and whether a consumer received a reasonable, tangible net benefit from a refinanced loan.
The rules also require loan officers, mortgage brokers, and non-bank mortgage lenders to disclose certain information when a consumer applies for a loan and at the closing of the loan.
Ohio's new Homebuyer's Protection Act, passed with bipartisan support earlier this year and will take effect on Jan. 1, 2007. The law provides the Attorney General with the authority to investigate, prosecute, and further define and prohibit predatory lending practices in Ohio. The law stems from a proposal initiated and pushed by Petro since 2003.
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