By Emily Stephenson and Margaret Chadbourn | Reuters
U.S. banks and housing groups are bracing for paperwork headaches and delays as major post-crisis mortgage reforms take effect later this week, but experts say prior warnings of a blow to the housing recovery will not be proven right.
On Friday, lenders must be prepared to verify that borrowers can repay their home loans, under rules written by the Consumer Financial Protection Bureau and required by the 2010 Dodd-Frank Wall Street oversight law.
Banks will have to consider a list of factors that show the consumer’s financial health, including income, existing debt obligations and credit history.
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