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Thursday, January 23, 2014


New Loan Safeguards Leave Path for Higher-Risk Borrowers

As regulators tighten mortgage rules and big banks resist lending to riskier middle-income Americans, state housing-finance agencies (HFAs) across the United States are rapidly expanding to restore the fading dream of homeownership. The state agencies got a boost from the Consumer Financial Protection Bureau, which exempted them from stricter mortgage regulations that it rolled out this month. Wells Fargo, the biggest U.S. home lender, already is doing business with the state groups, and Quicken Loans Inc., the fourth-largest originator last year, is looking to build relationships with HFAs. The agencies have become far more attractive since getting the exemption, Bob Walters, vice president of Quicken’s capital markets group in Detroit, says. "The question is, if the industry gets really interested in this and wants to expand lending, are the HFAs ready for this influx?" asks Ben Olson, who helped write the CFPB guidelines before leaving the bureau in May.

From "New Loan Safeguards Leave Path for Higher-Risk Borrowers"
Bloomberg (01/22/14) Gopal, Prashant

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