Maine Home Loan Lending Bill Introduced

Across the state, Maine mortgage holders are caught in a trap, finding it harder to stay on top of their payments (and keep) their homes.

As many people become squeezed between Maine home loans they cannot repay and lenders who are offering fewer financing options, local lawmakers are racing to figure out what they can do to stave off the worst.

That said, according to the Portland Press-Herald, legislation intended to curb widespread mortgage lending abuses was introduced today by the Maine Speaker of the House.

The bill, called the Maine Homeowner Protection Act, seekss to curb an increase in foreclosures in Maine by requiring greater disclosure of fees and payment structures for mortgages.

The law would impose limits on subprime, or bad credit mortgages, which are home loans made homeowners with poor credit histories.

Many of the foreclosures are caused by high fees and prepayment penalties, which make it much more expensive for a borrower to qualify for a mortgage refinance.

In addition, many homeowners use adjustable rate mortgages that start out with relatively low teaser rates but can rise dramatically after as little as two years.

The bill is backed by Rep. Glenn Cummings, D-Portland, who is the House Speaker. Hopefully, it gains widespread, bi-partisan support and can take effect soon.

SOURCE: Portland Press-Herald