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5 Cards in this Set
- Front
- Back
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What do predatory lender do? |
-Charge excessive fees points or interest rates. -Use prepayment penalties and ARMs |
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Traps |
Predatory lenders trap borrowers in unfair loan arrangments. Or strip equity from home and lend without considering borrowers ability to repay the loan resulting in foreclosures. |
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Who predatory lenders targer? |
XHomeowners who have equity, because the homeowner might have credit problems or need cash XOr borrowers who need financial assistance costly repairs on home or cars XElderly and low wage earners and minority homeowners. |
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Signs of preditory lending |
High interest rates Excessive points, late charges, prepayment penalties loan origination fees |
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Predatory schemes include Credit insurance packaging Asset based lending Misrepresentation Loan flipping Ballom payment High closing cost Deceptive loan servicing Home improvement loan Loan broker fees |
When the attache life insurance to the loan and creditor name themselves as the beneficiary. Asset based lending gibes borrower a loan based on the equity on there home not the ability ro repay or on their income. |
