Starting on January 1, 2014, it will be even harder for some individuals to qualify for a mortgage loan to buy a home.
Many federal agencies have made adjustments to several policies regarding the underwriting process of a borrower’s loan, which will in turn affect what a borrower is required to disclose.
Soon to be applied policies will demand a lender be able to confirm that its borrower is able to afford the home they are looking to purchase as well as repay the loan they are seeking. In addition, lenders are expected to provide their borrowers with up-to-date and accurate information regarding their loan balances and correct any mistakes in a timely manner.
Regarding foreclosures, a lender will be unable to initiate the foreclosing process until 120 days after the borrower’s last payment.
Richard Cordray, director of the Consumer Financial Protection Bureau, prepared a statement for the Consumer Federation of America (which is posted on their website) saying “By bringing back these basic building blocks of responsible lending and servicing the customer, we will improve conditions for consumers seeking to enter the market and for all those who are still struggling to pay down their existing loans.”
Mr. Cordray went on to say “by making the mortgage market work better, we will build consumer confidence and strengthen this essential foundation of our economy.”