US House passes mortgage reform bill | india | Hindustan Times
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US House passes mortgage reform bill

india Updated: May 08, 2009 11:06 IST

AFP
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The US House of Representatives on Thursday overwhelmingly approved legislation looking to scrap bank home-loan practices blamed for triggering a wave of foreclosures and the global economic crisis.

Lawmakers voted 300-114 for the measure, which notably aims to ensure that banks make a good faith efforts to ensure that mortgages go to borrowers who can repay them rather than issue "liar loans" with little such security.

The legislation also aims to reduce banks' incentives to promote riskier, more expensive loans to borrowers, or to package such loans into securities for investors.

"Insisting on responsible borrowing and lending and ensuring that borrowers enter into mortgages they can repay or refinance will help families protect their most valuable asset -- their home -- and guard against another financial and housing market meltdown," said Democratic House Speaker Nancy Pelosi.