The financial institutions division of the New Mexico Regulation and Licensing Department has published final regulations regarding the Home Loan Protection Act.The regulations provide guidance on loan flipping, approved third-party nonprofit counselors, and new limitations on the liability exposure of creditors and assignees, according to the Washington law firm Lotstein Buckman LLP. Under one of the new regulations, a creditor is deemed not to have "knowingly and intentionally" engaged in the act of flipping if the new loan provides a "reasonable, tangible net benefit" to the borrower. The regulation does not establish a mandatory method to determine the "reasonable, tangible net benefit" standard, but it provides examples of what constitutes such a benefit. Based on the rule, the financial institutions division clarifies that it approves any third-party, nonprofit counselor approved by the New Mexico Mortgage Finance Authority or the U.S. Department of Housing and Urban Development to issue a counseling certification required by the Home Loan Protection Act. Liability is imposed for violations of the law on those who buy or are otherwise assigned a high-cost home loan unless that person can demonstrate that a reasonable person exercising due diligence could not determine that the mortgage was a high-cost home loan.

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