WASHINGTON — Hoping to avoid another subprime crisis, the Federal Reserve on Monday approved a series of rules to more closely regulate the terms and circumstances of housing loans.

Lenders will be barred from making loans without proof of the borrower's income and must consider a borrower's ability to repay the loan from sources besides the value of the home. In addition, lenders would have to ensure that borrowers set aside money for taxes and insurance.

Also, the rules restrict penalties lenders impose for paying off loans early and require advertisements about mortgages to contain more information about rates and monthly payments. .

“Although the high rate of delinquency has a number of causes, it seems clear that unfair or deceptive acts and practices by lenders resulted in the extension of many loans, particularly high-cost loans, that were inappropriate for or misled the borrower,” Federal Reserve Chairman Ben S. Bernanke said at the meeting.

The rules do not apply to existing mortgages and take effect on Oct. 1, 2009.