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Financial reform bill is good news for consumers

Posted by Jill Boynton  June 28, 2010 10:50 AM

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Lawmakers have been working hard to come together on a financial reform bill, and on Friday finished crafting their joint version. If passed, President Obama plans to sign it into law on July 4th (it’s still not certain the bill will pass, as the death of Senator Byrd puts the majority vote in question.)

The bill is good news for consumers. It contains several provisions aimed directly at protecting consumers, including the creation of a Consumer Financial Protection Bureau whose role is to create laws to prevent unfair practices in consumer loans and credit cards. Another important feature of the law is a ban on no-income mortgage loans; lenders would be required to verify a borrower’s income before approving the loan. The law would also cap debit card “swipe fees”, the fee retailers pay to banks for the ability to accept debit cards.

Another important feature is a new low-interest loan for unemployed homeowners with good credit, using funds from the Troubled Asset Relief Fund. Other provisions of the bill related to mortgages include limits on mortgage origination fees and prepayment penalties and a prohibition on bonuses lenders earn based on the type of loan they sell.

Stay tuned for more about the financial reform bill as it is finalized.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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ABOUT MANAGING YOUR MONEY
Local finance professionals share insights and advice on issues such as budgeting, managing debt, and retirement planning.

About the contributors

D. Abraham Ringer is a CERTIFIED FINANCIAL PLANNER practitioner and a Financial Adviser with Morgan Stanley Global Wealth Management in Boston. He is registered in MA, NH, NY and several other states to which his articles are directed. For more information please visit www.morganstanleyfa.com/ringer
Financial Planning Association™ of Massachusetts has 900 members who specialize in the financial planning process. Many of its members engage in philanthropic pro bono work in their communities, recommend legislation, elevate public awareness, promote financial literacy, and advocate for sound economic and tax policies.
Odysseas Papadimitriou is the founder of CardHub.com, a credit card and gift card marketplace, and WalletHub.com, a personal finance site. He has more than 13 years of experience in the personal finance industry, and previously served as senior director at Capital One.

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