I've been trying to wrap my head around the changes 2009 will bring.  Numerous changes for borrowers and mortgage originators.  Some of The changes are:

If a loan is considered a "higher priced mortgage loan", based on a FHLMC published average prime offer rate more than 1.5% over this published rate or for a second mortgage, over 3.5%.  What this rate is determined to be has yet to be published.  I guess it will seriously affect the ability to offer no closing cost or reduced closing costs loans.(more than it already has)  We'll have to wait and see what that "FHLMC Prime Offer Rate" turns out to be.  IF you have a higer priced mortgage loan, then the following applies:

Regulation Z, creates 4 new "consumer protections". 

First, the lender must take into account the borrowers ability to pay from income and assets instead of solely on the homes value.  (I thought we were already doing this)

Second the income and asset information must be verified-NO MORE STATED INCOME LOANS! (believe it or not, I still get calls for those)

Third, escrow accounts for property taxes and home owner's insurance  are required.

Fourth, Pre payment penalties are restricted, no more than 2 years if the loan can change in the first 4 yrs.

It appears to me that the above is in response to the sub prime loan crisis.  By the time all this came into affect, sub prime lending is largely a thing of the past.  In a couple of years it will be a memory but we will still have the following regulations in affect.  

For all loans, it requires a good faith estimate with in 3 days after the customer applies for a loan.  The customer cannot be charged for anything up front other than a reasonable amount for a credit report.  The days of a lender charging a $400 application fee are gone. I never do this, but have had clients come to me that got hooked by an on line lender for this. When they found out the rate they were quoted was not accurate, they were stuck for the application fee.  This is a good thing!

I will get into the other regulation changes in other posts, there's plenty of them!