Charlotte Real Estate, Foreclosures, Short Sales

Federal Reserve Chairman Ben Bernanke has endorsed major changes to regulations in the financial system.  Bernanke believes that by giving the Fed more responsibility for guarding against financial crises, great power will be given to regulate the activities of key financial players.

In a speech at the Federal Deposit Insurance Corp, Bernanke says "Regulators must consider what can be done to make the U.S. financial system itself more stable without compromising the dynamism and innovation that has been its hallmark,"

Bernanke also partially endorsed a proposal, first made by Treasury Secretary Henry M. Paulson Jr., to give the Fed more explicit power to combat financial crises.  This would allow the Fed to come to the aid of any financial crisis that poses a risk to the system as a whole.

New Rules to Ban Misleading Lending Practices

New rules to ban deceptive lending practices are being vowed by the Fed.  "Besides offering broader protection for consumers, a uniform set of rules will level the playing field for lenders and increase competition in the mortgage market, to the ultimate benefit of borrowers," Bernanke said at an open Fed board meeting.

Bernanke wants a ban on prepayment penalties on such loans if the monthly payment can rise during the initial four years and non-verification of borrower's income and assets.  The new rules also require lenders to establish an escrow account for property taxes and insurance payments. No more no escrow loans.

Reaction to Bernanke