Those were good steps, but we also recognized that many of the problems we were beginning to see were a result of actions by companies and individuals not subject to our supervisory oversight. Thus, we conducted an additional HOEPA hearing, focusing on four specific areas: assessment of repayment ability; low- and no-documentation lending; escrowing for taxes and insurance; and prepayment penalties.
As a result of a careful review of available data and information, we proposed new rules under our HOEPA authority in December, banning practices that we found to be unfair or deceptive. Significantly, bans on such unfair or deceptive acts and practices would apply to the entire mortgage industry, not just to institutions directly regulated by the Board.