An Act to protect consumers by further defining subprime loans

This bill amends Massachusetts law to require stricter protections for first-time homebuyers taking out variable or adjustable-rate subprime loans. Under the new rules, these borrowers must explicitly agree in writing to the loan terms and receive counseling from an approved nonprofit organization before the loan closes. If a lender violates these requirements, the variable interest rate becomes unenforceable, and the borrower will only be charged the lower of the original or current adjusted rate for the rest of the loan term. The bill also exempts certain qualified mortgages that meet specific federal standards from these new restrictions.