Important Mortgage information when considering buying a home.

Always be an informed buyer when it comes to applying for a mortgage.

New mortgage rules take effect

New mortgage rules written by the Consumer Financial Protection Bureau (CFPB) went into effect last week, requiring lenders to verify that borrowers can repay their mortgages.

Banks will now be required to consider several factors that indicate a borrower’s financial health, including credit history, existing debt and income under the new rules. Most mortgage borrowers will see little or no impact on their ability to get a mortgage, but they will have to provide more proof the loan will be affordable.

The new rules aim to protect consumers in the process of buying a home and if they run into trouble paying their mortgages.

The CFPB has created a category of home loans that offer lenders broad legal protections against borrower lawsuits, provided they adhere to certain criteria. These “qualified mortgages” limit upfront fees and bar risky features such as no-interest periods that can leave homeowners stuck with unsustainable loans. The loans are available to consumers who have a debt burden that is no more than 43 percent of their income.

ROBIN TAYLOR, REALTOR

CENTURY 21 ALLIANCE

610-574-0015

C21ROBINTAYLOR@GMAIL.COM