LA County Information

County of Los Angeles
Department of Consumer Affairs
New Consumer Laws 2006

DCA
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Covered Loans:

The amount of a covered loan has increased (Financial Code 4970; Government Code 27388)

“Covered loans” are loans whose principal amount used to be $250,000 or less. Covered loans cannot have a prepayment penalty period longer than 36 months.

This new law increases the amount of a covered loan from $250,000 to an amount to be determined by the Federal National Mortgage Association (the exact amount has not been determined yet).

Action:  DCA’s Real Estate Fraud Unit takes complaints from homeowners whose covered loans have a prepayment penalty period that is longer than 3 years.

May be reprinted for non-commercial use if a credit line is included acknowledging the County of Los Angeles Department of Consumer Affairs.

For more information:
County of Los Angeles Department of Consumer Affairs
B-96 Kenneth Hahn Hall of Administration
500 W. Temple Street * Los Angeles, CA 90012-2706
Telephone (800) 593-8222 (within the County) * (213) 974-1452
web site: dca.lacounty.gov