Alternative Mortgage Transaction Parity Act of 1982
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The Alternative Mortgage Transaction Parity Act of 1982, also known as AMTPA, preempts state laws that restrict banks from making any mortgage except conventional fixed rate amortizing mortgages. AMTPA was contained in title VIII of the
Garn–St. Germain Depository Institutions Act The Garn–St Germain Depository Institutions Act of 1982 (, , enacted October 15, 1982) is an Act of Congress that deregulated savings and loan associations and allowed banks to provide adjustable-rate mortgage loans. It is disputed whether the a ...
passed in 1982 Mortgages allowed by the act included: *
Adjustable-rate mortgage A variable-rate mortgage, adjustable-rate mortgage (ARM), or tracker mortgage is a mortgage loan with the interest rate on the note periodically adjusted based on an index which reflects the cost to the lender of borrowing on the credit markets.W ...
s, in which the interest rate becomes floating after a number of years. *
Balloon payment mortgage A balloon payment mortgage is a mortgage which does not fully amortize over the term of the note, thus leaving a balance due at maturity.Wiedemer, John P, ''Real Estate Finance, 8th Edition'', p 109-110 The final payment is called a ''balloon ...
s have a large payment remaining when the loan comes due. * Interest-only mortgages only require the borrower to pay the interest on the principal balance for the first years of the loan.John Birger
How Congress helped create the subprime mess
,
Fortune Magazine ''Fortune'' is an American multinational business magazine headquartered in New York City. It is published by Fortune Media Group Holdings, owned by Thai businessman Chatchaval Jiaravanon. The publication was founded by Henry Luce in 1929. The ...
, January 31, 2008. The
United States House of Representatives The United States House of Representatives, often referred to as the House of Representatives, the U.S. House, or simply the House, is the lower chamber of the United States Congress, with the Senate being the upper chamber. Together they ...
passed H.R.3915 "The Mortgage Reform and Anti-Predatory Lending Act of 2007" in November, 2007. It remains before the
United States Senate The United States Senate is the upper chamber of the United States Congress, with the House of Representatives being the lower chamber. Together they compose the national bicameral legislature of the United States. The composition and po ...
. The House bill would require lenders to write mortgages that take into account the borrowers' ability to pay at the fully indexed rate.


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See also

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Financing Funding is the act of providing resources to finance a need, program, or project. While this is usually in the form of money, it can also take the form of effort or time from an organization or company. Generally, this word is used when a firm use ...
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Refinancing Refinancing is the replacement of an existing debt obligation with another debt obligation under a different term and interest rate. The terms and conditions of refinancing may vary widely by country, province, or state, based on several economic ...
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Bridge financing A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing. It is usually called a bridging loan in the United Kingdom, also known as a "caveat loan, ...
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Promissory note A promissory note, sometimes referred to as a note payable, is a legal instrument (more particularly, a financing instrument and a debt instrument), in which one party (the ''maker'' or ''issuer'') promises in writing to pay a determinate sum of ...
* Loan origination *
Subprime lending In finance, subprime lending (also referred to as near-prime, subpar, non-prime, and second-chance lending) is the provision of loans to people in the United States who may have difficulty maintaining the repayment schedule. Historically, subpri ...
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Subprime mortgage crisis The United States subprime mortgage crisis was a multinational financial crisis that occurred between 2007 and 2010 that contributed to the 2007–2008 global financial crisis. It was triggered by a large decline in US home prices after the col ...
{{Bank regulation in the United States Mortgage industry of the United States United States federal banking legislation Mortgage legislation