SC Governor Signs Lending Bill

The governor of South Carolina has signed an anti-predatory lending bill into law that both industry representatives and consumer advocates appear to be pleased with.The law, based largely on North Carolina's legislation, requires mandatory counseling for high-cost loans, for which the interest rate threshold is set at 8% above the corresponding treasury bill, the same as the federal Home Ownership and Equity Protection Act standard. The points and fees threshold for a high cost loan is 5% of the loan amount. The law also prohibits prepayment penalties for loans of less than $150,000, requires extra disclosure to the borrower concerning points and fees, and pre-empts local legislation on the issue. The South Carolina Mortgage Brokers Association said that it did not anticipate that the market would suffer as a result of the law's passage.