By By Catherine ReagorThe Arizona RepublicMon Jan 27, 2014 11:31 AM
New federal mortgage rules went into effect on Jan. 10 that are supposed to help protect borrowers and end abusive lending practices, many of which led to foreclosures and ultimately the real-estate crash.
Two of the most important changes:
A lender must determine whether borrowers can actually afford a mortgage by calculating their debt to income ratios.
Lenders must provide “qualified mortgages” that are less risky than interest-only loans, don’t have terms longer than 30 years or up-front fees for more than 3 percent of the mortgage balance.
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