Great news from one of the biggest mortgage regulators–the Consumer Financial Protection Bureau (CFPB) has announced plans to make it easier for small and rural banks to provide home loans. The change will take time, but the bureau’s news is the latest in technical adjustments that are slowly loosening the reins on a tight mortgage market.
If finalized, the proposal would increase the number of financial institutions that will be able to offer certain types of mortgages in rural and underserved areas, and help small creditors adjust their business practices to comply with the new rules.
Fannie Mae and Freddie Mac, the biggest providers of mortgage money in the U.S., recently began accepting low-down-payment loans and the Federal Housing Administration has lowered fees to make its mortgages less expensive.
According to CFPB Director Richard Cordray, responsible lending by community banks and credit unions did not cause the financial crisis, and mortgage rules reflect the fact that small institutions play a vital role in many communities. This new proposal, he says, will help consumers in rural or underserved areas access the mortgage credit they need, while still maintaining important consumer protections.
Find out more about the CFPB’s proposal to extend provisions to cover more community banks, credit untions and other creditors
If you’ve had trouble getting approved for a home loan, it’s probably worth making another call to your lender. To find out more, visit the CFPB website.