Jan 19, 2011 Todd Milner
Thanks to a new law enacted on January 1, lenders - whether they offer home loans or other types of credit - must now specify the fine print of their rates and how their offers stack up against other industry rates, the Federal Reserve states. The new law, which was passed by the Federal Trade Commission, forces lenders to provide one of three important details to borrowers. The requirements include a credit score notice, a risk-based pricing notice or an account review notice. The provided notice will be determined on a case-by-case basis, KSWT-TV reports. With wavering amounts of credit in the marketplace, the new rules will not only provide borrowers with a look at their credit report[s], but potentially stabilize borrowing or dissuade consumers from taking on debt they cannot afford. "There is a difference between having a lot of credit versus having a lot of credit and using it and being in debt," Ken Lin, chief executive officer of CreditKarma.com, told the Tennessean. The rule changes are welcomed by consumers, as the delinquency rate inched up to 3.01 percent during the third quarter of 2010, according to the American Bankers Association.