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AJ was suggesting a class, but I think that's a bit much. A couple of sheets of paper with various income levels listed, along with how much mortgage is recommended. Or a printout explaining, with clear numbers, how the loan will change if it's a non-traditional mortgage.

The government already requires that non-traditional mortgage recipients get a pamphlet about how their mortgage payments could change: This one is dated Oct 2006, but I know that when I got my most recent mortgage (an ARM) I got a similar pamphlet, so they've been in place for at least a year or so, and probably longer.

Many mortgage lenders are also providing simple sheets of different scenarios, as well as affordibility guidelines, but I would suspect that lenders like the ones who are in trouble now were not among those lenders.

That's why I was suggesting a required class, to walk people through the details - many people, when they get their pamphlet/information sheets don't read them, just like they don't read the contracts that they are signing.

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