I read an article the other day and was struck by the following quote.

"The Federal Reserve Board is considering potential revisions to Reg Z, including: (a) simplifying and clarifying Regulation Z's adjustable rate mortgage disclosures, to make them easier for consumers to understand and use; (b) requiring a "worst-case" payment disclosure; (c) requiring additional disclosures in connection with negatively amortizing loans; and (d) changing Regulation Z's timing requirements for transaction-specific, non-purchase loan disclosures."

The upcoming boom in foreclosures is, and has been forecasted by many professionals.
Nothing new there.
But as I have said before, the underlying reasons for this upcoming boom is largely due to good people who were sold bad loans for all the wrong reasons by unscrupulous loan originators.

It's a industry wide problem.

Everyday I get countless mail and spam advertising rates as low as 1%. I'll bet you do too.

The problem is that so many bay area homeowners have bought into loans like these or similar. They may have refinanced a couple of years ago into an adjustable rate mortgage with a 2 or 3 year fixed rate period. But that was a couple of years ago and now those fixed periods are running out and these same owners will now see there monthly payments rise incredibly.

When that happens the first thing they will do is seek another refi. This time though they'll have a harder time qualifying. Many factors go into a qualification. Income, Debts, Debt Ratios, Loan to Value Ratios, and so on. If their house has declined in value, what was a good enough debt ratio and loan to value ratio may not be good enough this time.

In the last refi they may have had enough equity to pay off all their consumer debt.
This time they might not have the equity yet have run the credit card balances back up again.

They might be left with no choice but to sell or continue on paying their new much higher monthly payment. That's when we'll see the foreclosures really start!

So now that the cows have left the barn...
The fed's is thinking maybe the consumer should have a little more disclosure?

I'm all for that, but aren't they a little late?