New federal law is requiring banks to be more transparent. Now the Federal Reserve is trying to do the same about their lending practices.
The Federal Reserve is listening to consumer groups as it begins to revise data reporting regulations.
Consumer groups pointed out there is no data being collected about loan modifications.
"The outcomes for people who are trying in good faith to stay in their homes... they're often poor outcomes, and people are losing their homes, and there's really no information that we have about that, and it's all happening behind the public's view," says Kevin Stein from the California Reinvestment Coalition.
Eva Calzado, a Vallejo homeowner, is in foreclosure. She thinks she was a victim of predatory lending because she did not understand the documents.
"I talked to my broker in my language, which is Tagalog. That's my language and the language I am most comfortable with, but all of my loan contracts were in English," says Calzado.
Major lenders, including Chase and Wells Fargo, testified as well. While embracing more transparency, Wells Fargo attorney David Moskowitz raised privacy concerns.
"It will be very easy to identify you as an individual person, your credit score, the amount of equity you have in your home, where you live. All that information will be very simple to figure out if it is transmitted from the lender to the database to the public," said Moskowitz.
Kathy Chao Rothberg heads Lao Community Development, an agency in Oakland that counsels homeowners facing potential foreclosure. She says lenders often won't explain why they're saying no to a loan modification.
"They have a right to know why they were denied. We have cases where they were denied, and they wouldn't tell us a straight answer," says Chao Rothberg.
While there seems to be consensus that there needs to be change, there are still two more public hearings and then it may take the Federal Reserve one and possibly two years to implement them.
