Today, President Obama signed into law the Restoring American Financial Stability Act - the most important regulatory overhaul of our nation's financial system since the reforms that led to 60 years of sustained growth after the Great Depression.
For eight years, Wall Street played Russian roulette with America's future while Republicans in Congress and President Bush looked the other way. This law ends bailouts for big Wall Street banks and protects consumers and the financial system from the damaging practices that got us into this mess.
Here are 10 ways the new law will help consumers like you:
- Clear and Accurate Financial Information: A new consumer bureau will ensure American consumers get the clear, accurate information they need to shop for mortgages, credit cards, student loans, and other financial products, and protect them from hidden fees, abusive terms, unfair terms and deceptive practices.
- Access to Your Credit Score: Consumers will now have free access to their credit score, if their score negatively affects them in a financial transaction or a hiring decision.
- End of Unfair Lending Practices: The financial incentives for subprime loans that encourage lenders to steer borrowers into more costly loans will be prohibited, along with the pre-payment penalties that trapped so many borrowers in unaffordable loans.
- Consumer Hotline: Creates a national consumer complaint hotline so consumers will have, for the first time, a single, toll-free number to report problems with financial products and services.
- Reduced Debit Card "Swipe Fees": Businesses can't be charged extra for debit card "swipe fees" beyond the cost of processing those transactions. This could save American small businesses billions of dollars each year, savings which can then be passed along to consumers in the form of lower prices.
- Trusted Investment Advice: Brokers who offer investment advice will have to act in the best interests of consumers, not their own financial interests.
The law also includes several programs to help homeowners and those considering purchasing a home:
- End of Mortgage Abuses: The law eliminates many of the hidden fees and abusive practices that trapped so many families with loans they could not afford to repay, resulting in record foreclosures.
- Emergency Mortgage Relief: Building on a successful Pennsylvania program, the law provides $1 billion for bridge loans to qualified unemployed homeowners with reasonable prospects for reemployment to help cover mortgage payments until they are reemployed.
- Banks Must Disclose Risk of Mortgages: Lenders must disclose the maximum a consumer could pay on a variable rate mortgage, with a warning that payments will vary based on interest rate changes.
- Expanded Consumer Protections for High-Cost Mortgages: The law expands the protections available under federal rules on high-cost loans -- lowering the interest rate and the points and fee triggers that define high cost loans.
10 Ways New Wall Street Reform Law Will Help You was also cross-posted to the House Democrats Blog
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The President promised that he would go after Wall St. regardless of the cost...and he did it. He promised to pass Health Care Reform and followed through. The President negotiated a nuke reduction deal with Russia, re-engineered the Afghanistan war, began withdrawing our Troops from Iraq. Have you ever seen a POTUS accomplish as much as President Obama in such a short time?
"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered." – Thomas Jefferson 1802
Maybe you don't like everything Obama is doing but I do believe that he and the Democrats are actually delivering to their voters exactly what they said they would. Like'em or not, the Democrats delivered.
What has the Republicans Party done for its constituency? Did they deliver? I don’t think so.
Have you ever wondered why, if both the Democrats and the Republicans are against deficits, we have deficits? Have you ever wondered why, if all the politicians are against inflation and high taxes, we have inflation and high taxes?
You and I don't propose a federal budget. The president does. You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does. You and I don't write the tax code. Congress does. You and I don't set fiscal policy. Congress does. You and I don't control monetary policy. The Federal Reserve Bank does.
One hundred senators, 435 congressmen, one president and nine Supreme Court justices - 545 human beings out of the 235 million - are directly, legally, morally and individually responsible for the domestic problems that plague this country.
And the years prior to time frame you refer to in the above statement? Remember Rubin? He basically legalized the Citibank merger with Travellers and scrapped the Glass Steigel Act. How convenient for Rubin to land a gig with Citigroup right after he left Treasury.
Remember Summers, he works in the White House now. He legitimized and ensured there would be little to no regulation in the OTC derivatives market.
Let's not heap all the blame on the republicans. This was a bi partisanship effort. Don't forget Dodd who recently lied about AIG executives not receiving bonuses after that insolvent company was resuscitated thanks to the taxpayers.
Yeah... too bad they can't seem to put those reforms back in place.
I feel SO much better...with my underwater mortgage, in my neighborhood of foreclosed homes, full of my unemployed friends
while I watch the banksters lavishing themselves with ALL that money can buy...
now that they have it all, and I CAN...ONLY...WATCH.
You're all heart buddy!
Nice job perpetuating Corporate Communism! What's your next trick?
From the WSJ: The new law will make ratings firms liable for the quality of their ratings decisions, effective immediately. The companies say that, until they get a better understanding of their legal exposure, they are refusing to let bond issuers use their ratings.
That is important because some bonds, notably those that are made up of consumer loans, are required by law to include ratings in their official documentation. That means new bond sales in the $1.4 trillion market for mortgages, autos, student loans and credit cards could effectively shut down.
were screaming the whole time "Look Out!"
What is the deal with these Huffington Post by-lines? If you don't put in there that Republicans are
100% at fault then you are afraid no one will read it? Try being intellectually honest next time.
The dyed-in-the-wool Democrats and Republicans have more in common than their blaming the other for everything that goes wrong on earth: they also receive enormous contributions from the financial, insurance and real estate (FIRE) industries, from big pharma, big ag, and the Israeli lobby. Nothing will be solved while either party holds power.
#11 - Add another 5,000 public sector employees.....
:)
I hardly think the new language in which our interest rates, though usurious by FDR's standards, are clearly set out is anything like a big deal. Rather, I think it's pitiful small by way of an achievement. Folks casting about desperately for money borrow because they must, from nearly any source, at nearly any terms-- or else there would be no payday lenders-- and incidentally, there shouldn't be.
And if you really think the swipe fees will be passed along in the form of reduced prices to consumers, hold your breath and wait for all the savings, if you dare. I'd rather live.
I am a lifelong Democrat, but great achievements like this one are schooling me, an old dog who still has enough wits about him to learn a new trick or two. Do you?
The game the Obama administration played was to introduce a very weak bill. When true financial conservatives and progressives attempted to strengthen it, by introducing meaningful regulation of derivatives trading, bank capitalization requirements, breaking banks up into separate consumer and investment institutions, or outlawing credit default swaps, the administration fought tooth and nail to defeat them. Having succeeded, they then point to the bill as passed, saying they resisted all attempts to weaken it.
They say the most meaningful part of the bill is the requirement for greater capitalization, which will be negotiated as an international agreement. In theory that is good, because an international agreement would not put one country at a disadvantage to another. The problem is that the US wants minimum increases, while the EU, having been stung by our excesses, wants higher capitalization. Guess who will get their way! So, in the end, it is all window dressing.
And if so... when it would go into effect.