Feds Outline New, Tougher Credit Rules

Paulson pushes stricter standards for mortgage lenders
By Jim O'Neill,  Newser Staff
Posted Mar 13, 2008 6:51 AM CDT
Feds Outline New, Tougher Credit Rules
Treasury Secretary Henry Paulson listens to opening remarks from members of Congress on Capitol Hill in Washington, Wednesday, March 5, 2008, prior to giving his assessment of efforts to heal the American economy while testifying before the House Appropriations subcommittee on Financial Services and...   (AP Photo/J. Scott Applewhite)

A panel led by Treasury Secretary Henry Paulson is seeking a major overhaul of rules affecting mortgage lenders and a credit market decimated by risky subprime loans and loose oversight, the Wall Street Journal reports. Among panel recommendations to be released today:

  • Strengthen mortgage lender and broker oversight
  • Establish licensing standards for mortgage brokers

  • Require credit-rating firms to differentiate between complex-structured products and conventional bonds
  • Require issuers of mortgage-backed securities to reveal "the level and scope of due diligence" and the underlying assets of the securities
  • Require disclosure of whether "issuers have shopped for ratings"
  • Urge global bank regulators to require banks hold sufficient capital to cover risky investments
  • Update standards for how banks manage liquidity
(More Henry Paulson stories.)

Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X