Regulatory Alerts2007-05-01
Added · Updated
Proposed Regulation 2106/2208 Guidance On Nontraditional Mortgage Product Risks
The State Bank Commissioner proposes to adopt Regulation 2106/2208 to establish guidance on nontraditional mortgage product risks for mortgage brokers and mortgage companies in Delaware not affiliated with a bank holding company or an insured financial institution. The regulation requires providers to maintain underwriting standards that address payment shock and negative amortization, verify borrower repayment capacity, and implement robust risk management practices including written policies and quality controls. It mandates clear and balanced consumer disclosures regarding product risks and prohibits unfair or deceptive practices under applicable laws. The proposed regulation is scheduled for adoption on or after June 6, 2007, following a public hearing on June 6, 2007.