By the Division of Banks

January 30, 2008

SUBJECT:COUNSELING AND OPT-IN REQUIREMENTS FOR SUBPRIME ADJUSTABLE RATE MORTGAGE LOANS MADE TO FIRST TIME HOME LOAN BORROWERS

To the Chief Executive Officer of the Institution Addressed:

This letter is to inform you that the Division of Banks (the "Division") recently adopted Regulatory Bulletin 1.3-104 . The Regulatory Bulletin, which became effective on January 30, 2008, sets forth guidance relative to the determination of whether a variable or adjustable rate mortgage loan to a first-time home loan borrower qualifies as "subprime" for the purposes of General Laws chapter 184, section 17B1/2. The Regulatory Bulletin also provides guidance which is intended to facilitate the implementation of the consumer counseling and affirmative opt-in provisions contained in SECTION 7 of Chapter 206 of the Acts of 2007 relative to variable or adjustable rate subprime mortgage loans made to first-time home loan borrowers. The Regulatory Bulletin can be found on the Division's web site at www.mass.gov/dob under 'News and Updates' as well as under the link provided for 'Legal Resources.'

Although Regulatory Bulletin 1.3-104 took effect as of the date of this letter, the Division is pleased to accept comments on the Regulatory Bulletin from interested parties which should be submitted by February 20, 2008 via e-mail to dob.comments@state.ma.us or by mail addressed to Steven L. Antonakes, Commissioner of Banks, One South Station, 3 rd Floor, Boston, MA 02110. Based upon a review of all of the submitted comments, the Division will determine whether any additional revisions to the Regulatory Bulletin are necessary.

Very truly yours,

Steven L. Antonakes
Commissioner of Banks