NEW YORK Standard & Poors on Thursday issued a comment on high-cost residential mortgage loans, saying that a small percentage of borrowers fall victim to unfair lending practices.
Despite the countrys 67% home ownership rate, which translates to about 71 million families, predatory lending in the subprime market has become a political issue, the comment went on. Because this market is currently being tapped by record numbers of low- and moderate-income families looking to refinance for consumer credit reasons, even more borrowers are likely to fall victim to the underlying threats of predatory lending.
The comment goes on to S&P has always been aware of consumer protection laws pertaining to mortgage originations, and requires reps and warrants in its agreements to protect its investors.
While there may be more of a national focus on this issue today, our stance is still aimed at looking out for the investors by ensuring that originators and issuers rep and warrant that TILA, HOEPA, and RESPA other statutes and regulations are all being upheld, said Michael Stock, a director within Standard & Poors RMBS Group.
