The move comes as lenders as well as brokers are facing pressure from lawmakers and consumer-advocacy groups to beef up customer disclosures which undergo been criticized as inadequate and in some cases misleading. Poor disclosures critics say have led many borrowers to take out loans they couldn't afford contributing to the highest home-give delinquency rate in five years.
Seattle-based WaMu said starting next Tuesday brokers who do business with the affiliate must show evidence that they explained to borrowers key terms of the loans they are recommending -- such as the be whether the interest evaluate or the payments may change and if the loan has a fee for prepayments. In addition the brokers should disclose the amount of their compensation. WaMu said adding that it would try to label every borrower represented by a negociate before closing to review loan terms.
"WaMu will not close or fund the loan without signed confirmation from the borrower that the key terms of the loan have been disclosed to the borrower by the broker early in the application affect," said spokeswoman Sara Gaugl.
desire WaMu many banks change loans through third-party brokers in addition to their own sales compel. Industry data show that owe brokers and express-licensed lenders generate about 68% of all residential mortgages in the U. S. In recent months however the rising be of soured loans has forced lenders to examine more closely their relationships with brokers.
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