Gov. Arnold Schwarzenegger approved seven new laws that provide a range of consumer protections to home-mortgage holders and may allow some to hold on to their houses.
The governor signed AB 260 by Assemblyman Ted Lieu (D-Torrance). The measure, which takes effect Jan. 1, tightens restrictions on mortgage brokers so they cannot steer borrowers to riskier, higher-interest loans when they qualify for less-expensive ones.
The new law also bans so-called negative-amortization loans, which offer the option of monthly payments so low that the loan amounts can actually grow over time. The law also limits prepayment penalties to no more than 2% of the loan balance and allows state regulators to enforce federal lending laws.
The governor banned similar legislation last year at the urging of some groups in the mortgage and real estate industries. Read more…
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"Licensed by the Virginia State Corporation Commission as MB-2175" 
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