A look at Obama’s proposal to create a Consumer Financial Protection Agency:
— The agency would oversee products used by consumers such as mortgages, credit cards, payday loans and terms on savings accounts.
— The agency would be in charge of implementing a law passed by Congress this spring that protects consumers from sudden interest rate increases on unpaid credit card balances.
— Lenders would be required to be upfront about their products. Potentially, lenders would have to apply a warning label to risky products like mortgages with house payments that balloon in size and show buyers how those terms compare to a traditional fixed-rate mortgage.
— The agency would be required to police the market continuously and publish its findings once a year.
— The agency would be tasked with trying to simplify and reduce regulations if authorities overlap. It also would be required to consider the burden of its own regulations.
— A five-member board four members nominated by the president and confirmed by the Senate would run the agency. The fifth member would be the director of the new National Bank Supervisor, the merged agency the administration is proposing to create to take over bank regulation duties.
Copyright 2009 The Associated Press.