This is one of the things promised back in December from the Federal Reserve that will likely be harmful to the consumer even though the government doesn't believe that statement.  So, let's look at the highlights. 

The final rule adds four key protections for a newly defined category of "higher-priced mortgage loans" secured by a consumer's principal dwelling.  For loans in this category, these protections will:

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      • Prohibit a lender from making a loan without regard to borrowers' ability to repay the loan from income and assets other than the home's value.  A lender complies, in part, by assessing repayment ability based on the highest scheduled payment in the first seven years of the loan. To show that a lender violated this prohibition, a borrower does not need to demonstrate that it is part of a "pattern or practice."
        My comment:  Two things, the first being that it essentially eliminates "stated" loans.  While that may be a good thing on the surface, many Americans that deserve to be in homes may not qualify anymore, especially small business owners who are aggressive with their tax deductions.  The other part is that any lawsuits or complaints are sided with the borrower, further restricting loans.  I am all in favor of borrower protection, but overdoing it actually hurts the borrower.
        
      • Require creditors to verify the income and assets they rely upon to determine repayment ability.
        My Comment:  Again, read it as "no more stated or no doc loans, period."  A harmful move for many Americans who have the ability to repay, but cannot "show it on paper."
        
      • Ban any prepayment penalty if the payment can change in the initial four years.  For other higher-priced loans, a prepayment penalty period cannot last for more than two years. This rule is substantially more restrictive than originally proposed.
        My Comment:  Forget about those declining prepayment penalties, so expect prepayment penalties to rise to a level penalty for the duration.  The limitation of 2 years is basically moot as most lenders used that limit before, since most subprime loans were 2 year ARMs.  This ruling is basically useless, except that it can further harm the consumer.
        
      • Require creditors to establish escrow accounts for property taxes and homeowner's insurance for all first-lien mortgage loans.
        My Comment:  This is one of the most harmful amendments.  Most homeowners can earn interest on these payments in investments, savings, etc. instead of surrendering that money to the lenders and earn nothing.  This move is like stealing money from the homeowners.

All in all, this final ruling on Truth in Lending will prove more harmful than good, yet another feeble attempt by the government to fix a problem through overregulation.