The federal financial regulatory agencies seek comment on a proposed Statement on Subprime Mortgage Lending issued Friday. The agencies seek to address certain risks and emerging issues specifically related to lending practices in hybrid subprime adjustable rate mortgages that may cause borrowers payment shock down the road and ultimately foreclosure. "The proposal addresses concerns that subprime borrowers may not fully understand the risks and consequences of obtaining these products, and that the products may pose an elevated credit risk to financial institutions," according to an announcement by the agencies, which consist of the Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the National Credit Union Administration.
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