WASHINGTON, D.C. — New mortgage rules are to take effect this Friday to protect borrowers from abusive lenders. The goal is to cut the risk of defaults and foreclosures.
Lenders now have to determine whether a borrower will have the income and assets to make payments throughout the life of the loan.
The new rules mean lenders will look at potential home buyer’s paychecks, credit card debt and car payments.
There should be a debt-to-income ratio lower than 43% in most cases, but, first time buyers may have a better chance at getting a loan because the new rules do *not require a minimum down payment.