Anti-Predatory Bill to Focus on Ability to Repay

A predatory-lending bill that House Democrats plan to introduce in September will place a lot of emphasis on the borrower's ability to repay the loan as a way to prevent loan flipping and to restore investor confidence in the mortgage-backed securities market."Given the meltdown in the subprime market and the foreclosure rate, we will pay more attention to that [ability to repay] -- not just as a protection for consumers, but as a protection to reassure the market," Rep. Brad Miller, D-N.C., told MortgageWire. He said most of the protections in the bill will apply to all loans. "We want to make sure that lenders are lending to people who can actually pay back the loan according to its terms," he said. Reps. Miller and Mel Watt, D-N.C., will be the lead sponsors of the anti-predatory-lending bill that House Financial Services Committee Chairman Barney Frank, D-Mass, wants to mark up in late September or early October. "We are developing a bill that we fully expect to pass the House and the Senate," Rep. Miller said in an interview.