Shopping for a mortgage takes time and effort. Choosing the wrong mortgage can be very costly. It could lead to the loss of your home if you can’t afford the payments. But new federal consumer protections will increase the likelihood of finding a fair mortgage that you can afford for many years.

The new rules recognize that disclosures alone can not always protect mortgage borrowers from the harm caused by unfair and abusive lending practices.

Rules # 1 through #3 and #7 went into effect on October 1, 2009. Rules #4 and #5 went into effect on July 30, 2009. Rule #6 will go into effect on January 1, 2010.

#1) For home mortgage loans (not including home equity lines of credit), mortgage lenders and brokers are prohibited from coercing or encouraging real estate appraisers to misrepresent the value of a home. This is intended to ensure the integrity and accuracy of an appraisal, so that a consumer is not overpaying for a home or borrowing more money than the home is worth.

#2) Mortgage loan servicers (companies that collect mortgage payments and perform other duties for lenders) are prohibited from engaging in these unfair actions: (a) failing to credit a loan payment on the date it is received; and (b) deducting a late-payment fee from a loan payment without informing the borrower and thereby creating a shortage that triggers additional fees for the borrower, month after month, even when the next loan payments arrive on time.

#3) For mortgages with a relatively high interest rate typically because the applicant is considered a subprime credit risk, the new rules contain these protections: (a)a lender is prohibited from making a higher-priced loan without regard to a borrower’s ability to repay from income and assets other than the home’s value; (b)lenders of higher-priced mortgages are required to verify a loan applicant’s income and assets using reliable, third-party documents and not based on the word of the borrower.; and (c)in certain cases, the lender cannot impose a prepayment penalty if the borrower pays a loan off early.

#4) The U.S. Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (the SAFE Act) requires mortgage loan originators — including loan officers at financial institutions and independent mortgage brokers — to register with the government and enter information about their background and disciplinary history into a central database that consumers can access. The SAFE Act is intended to enhance consumer protections and reduce fraud in the residential mortgage industry.

Before committing to a mortgage that is too complex to understand, you should seek help from an attorney or a trained, reputable housing counselor. You can find a counselor at NeighborWorks America (www.nw.org) or by calling 1-888-995-HOPE (4673). For a referral to a local HUD-certified counseling agency, visit www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm or call 1-800-569-4287.