North Carolina's predatory-lending laws may travel

...[A]s Washington lawmakers hash out how to deal with millions of potential foreclosures, North Carolina's predatory-lending laws are shaping the debate.

...The North Carolina Home Loan Protection Act bans penalties for borrowers who pay off their mortgages early, mandates that lenders verify income, and is expected to limit the fees brokers collect for arranging certain high-rate mortgages...

... Critics of that 1999 law argued it would crimp North Carolina's housing market. But academic studies have found no such impact. In fact, the state thrived during the boom and has fared better than most during the downturn. Foreclosure filings rose 39% in this year's first half, far less than the 56% jump nationwide, according to research firm RealtyTrac. In the second quarter, median home prices were up 8% in Charlotte, the state's largest city, and Raleigh, the capital, vs. a 1.5% average drop for the U.S. "The bottom line is that [the regulations are] working," says North Carolina Attorney General Roy Cooper, who sponsored the 1999 law as a state senator. "North Carolina has strong banks that are tough but fair, and there's plenty of available credit."

These Tough Lending Laws Could Travel (BusinessWeek, November 5, 2007)