October 15, 1982 - Alternative Mortgage Transactions Parity Act

Policy Name: Alternative Mortgage Transactions Parity Act of 1982, Title VIII of the Garn-St. Germain Depository Institutions Act (H.R. 6267)

Date: Effective October 15, 1982

As Title VIII of the Garn-St. Germain Depository Institutions Act, the Alternative Mortgage Transactions Parity Act of 1982 (AMTPA) sought to increase access to the housing market for borrowers with poor credit. AMPTA preempted state laws in order to lift the restrictions on non-conventional mortgages in the United States. Before AMPTA, many states prohibited banks from writing home loans other than conventional fixed-rate mortgages. With the dramatic rise in interest rates during the 1970s, these state restrictions on home mortgages increasingly prevented low-income borrowers from becoming homeowners.

To make homeownership more accessible, AMPTA allowed alternative mortgage transactions to enter the mortgage market. These mortgages included adjustable-rate mortgages, balloon-payment mortgages, and interest-only mortgages. By introducing new types of mortgages to the market, AMPTA contributed to the growth of the mortgage market in the 1980s, but also added increased layers of risk.