Washington Mutual Sets New Lending Standards

Today Washington Mutual announced that they would put in place new standards for the mortgage brokers it does business with.

These standards are intended to help borrowers understand the terms and conditions as well as the compensation being paid to brokers. These standards are designed to prevent more borrowers from getting trapped into an adjustable rate mortgage. This plan was developed from rising concerns that consumers have not been adequately informed about their mortgage terms and fees.

Washington Mutual will now require evidence that mortgage brokers have disclosed to their borrowers all terms and conditions of their loans. A Washington Mutual representative will also attempt to call all borrowers prior to closing to review the terms directly. This should hopefully prevent dishonest brokers from selling loans to borrowers that they did not request.