Don’t Overlook the Higher-Priced Mortgage Rule

 

To protect consumers, the Fed introduced a new category of mortgages—the higher-priced mortgage. The Fed also applied additional protections concerning a person’s ability to repay, prepayment penalties, and escrow requirements for first liens on these mortgages.CU Directors Newsletter

This new category of loans and protections basically applied to all closed-end loans secured by a consumer’s principal dwelling that met a certain threshold.

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