Many families in Washington are struggling. Property taxes are rising and the costs for fuel and food are skyrocketing. These added costs, along with some unscrupulous subprime mortgage lenders, have undermined the American dream for too many families in our state and around the nation.

I am happy to report the Legislature took some bold action this year to help homeowners facing fore-

closure and protect consumers applying for home loans.

I was pleased to support a measure this year that provides more certainty for new homebuyers. House Bill 2770 was the product of the Homeowner Security Task Force formed to evaluate the instability in the national subprime mortgage market and make recommendations that would minimize the impact of this national trend in Washington. The task force was comprised of 17 individuals from consumer groups, the financial industry, construction and real estate industries, non-profit organizations and government.

The bill tackles the confusion of home loans by requiring mortgage brokers to disclose more clearly the many facets of the loan, including alerting the consumer of the best available interest rate for which he or she qualifies. It also limits prepayment penalties that may apply to an adjustable-rate mortgage. The most significant part of House Bill 2770 is that it builds sideboards in the mortgage lending industry. For example, a framework for penalties is established for crimes related to mortgage fraud. Negative amortization of a home loan and “steering” consumers to a less advantageous home loan are also prohibited under the new law.

Another measure I supported, Senate Bill 6381, mandates mortgage brokers to have a fiduciary responsibility to borrowers. This will make sure mortgage brokers are acting in good faith and requires full disclosure to the borrower with regard to fees and expenses paid as part of the loan.

In addition, the Legislature allocated funding this year for the Washington State Department of Financial Institutions to set up counseling services for consumers caught in the subprime lending crisis and possibly facing foreclosure.

I encourage families who need assistance with their home loan to contact the Washington State Homeownership Information Hotline at 1-877-894-4663 or visit

www.homeownership.wa.gov for a list of counselors in their area.

Families deserve to be treated fairly, particularly when purchasing their most valuable asset – a home. As part of your legislative team, I will continue working on fixes to the lending crisis and fight to ensure families can afford the American dream.

Rep. Norma Smith, 10th Legislative District, serves on the House Insurance, Financial Services and Consumer Protection Committee.