Thanks to an increase in foreclosures, and in the recent subprime lending crash, Congress is looking into mortgage lending practices. The Houston Chronicle reports:

With the number of foreclosures nationally jumping 47 percent in March
from a year ago, lawmakers are weighing whether new lending rules are
needed or whether the market is already in the process of
self-correcting. The task of crafting reforms is made more complicated
by the long list of players involved in mortgage transactions.

However, with the current mortgage lending system, there is a lot to wade through. Mortgage lending practices that target those with poor credit can sometimes result in situations in which the prinicipal owed actually goes (negative amortization can do this). Also, some lenders allow home owners to take out home equity loans for as much as 125% of their equity. Such mortgage lending can make it difficult for borrowers to pay back the amount, sometimes resulting in foreclosure.

Tags: Congress mortgage lending, personal finance, financial planning, finances,
financial goals, mortgage lending, home equity loans, subprime lending crash