MCLEAN, Va. - Freddie Mac is drawing praise from lenders, federal legislators and consumer advocates for the series of steps it announced aimed at protecting borrowers from predatory lending practices. The steps include a ban on the purchase of mortgages with single-premium credit insurance policies and requiring subprime lenders to accurately and fully report their borrower credit files to credit repositories. Freddie Mac's announcement today puts the subprime lending industry on notice that there is no secondary market for predatory loans, said Rep. David E. Price (D-N.C.). Freddie Mac's ban on single premium credit insurance is accompanied by several other steps the company recently took to combat predatory lending. For example, in February, Freddie Mac became the first secondary market investor to require all lenders, including subprime lenders to report monthly borrower mortgage payments to all three credit repositories on loans they service for the company. Freddie Mac will monitor lenders' track record in reporting so that borrowers can obtain lower-cost loans when their credit improves.
Freddie Mac takes anti-predatory lending steps
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