…Mortgage originators who serve rural and underserved areas would be allowed to give out loans with balloon payments.
“This option is meant to preserve access to credit for consumers located in rural or underserved areas where creditors may originate balloon loans to hedge against interest rate risk for loans held in portfolio,” the Fed said in a statement…
I disagree with the above provision. Borrowers in these areas are the LEAST able to keep their properties (of ALL borrowers) when faced with a balloon payment.
This is the ultimate dumbest idea I’ve heard in a long while.