Common predatory lending practices The lender makes a loan based upon the equity in your home, whether or not you can make the payments. If you cannot make payments, you could lose your home through foreclosure. The lender may promise one type of loan or interest rate but without good reason, give you a different one.
Predatory lending practices, broadly defined, are the fraudulent, deceptive, and unfair tactics some people use to dupe us into mortgage loans that we can't afford. Burdened with high mortgage debts, the victims of predatory lending can't spare the money to keep their houses in good repair.
Predatory lending is any lending practice that imposes unfair and abusive loan terms on borrowers, including high-interest rates, high fees, and terms that strip the borrower of equity. Predatory lenders often use aggressive sales tactics and deception to get borrowers to take out loans they can't afford.
Predatory lending tactics may involve loans with high-interest rates, hidden and excessive fees, undisclosed terms, and more.
Which of the following is NOT considered a predatory lending practice? Charging low origination fees to encourage loan applications.
making unaffordable loans based on the assets of the borrower, rather than on the borrower's ability to repay an obligation ("asset-based lending") inducing a borrower to refinance a loan repeatedly in order to charge high points and fees each time the loan is refinanced ("loan flipping")
Predatory lenders typically target minorities, the poor, the elderly and the less educated.
Other types of lending sometimes also referred to as predatory include payday loans, certain types of credit cards, mainly subprime, or other forms of (again, often subprime) consumer debt, and overdraft loans, when the interest rates are considered unreasonably high.
Which of the following may be an indication of predatory lending? The answer is a borrower with a 580 credit score is offered a loan with credit life premiums included. Tacking on unnecessary insurance premiums such as “credit life” is a practice that predatory lenders often use to increase profits.
There are four commonly recognized types of predation: (1) carnivory, (2) herbivory, (3) parasitism, and (4) mutualism. Each type of predation can by categorized based on whether or not it results in the death of the prey.
Predation involves four steps: search, recognition, capture, and handling. The possibility of co-evolution of predator and prey operates at each of these steps.
Predators exhibit traits such as sharp teeth, claws, and venom that enhance their ability to catch food. They also possess extremely acute sensory organs that help them to find potential prey.
Predator foraging traits include body size (mass or length), gape size, hunting or foraging mode (for example, ambush or active hunting), and feeding mode (for example, chewing or suctorial) 5, 12, 20.
What is it? Predatory mortgage lending, whether undertaken by creditors, brokers, or even home improvement contractors, involves engaging in deception or fraud, manipulating the borrower through aggressive sales tactics, or taking unfair advantage of a borrower's lack of understanding about loan terms.
Usury is the act of lending money at an interest rate that is considered unreasonably high or that is higher than the rate permitted by law.
Which situation is LEAST LIKELY to be an example of predatory lending? A subprime loan in and of itself is not evidence of predatory lending.
Losing one's home to a predatory lender also causes significant social harm. Neighborhood stability and revitalization efforts are disrupted when houses are left unoccupied during the foreclosure process and remain empty after the sheriffs sale.
Page reading time: 1 minute. The process of moving a customer from one financial product to another in order for an adviser or broker. A person who arranges a contract between you and, for example, an insurance or mortgage service provider. Brokers usually receive a commission or fee for arranging a contract.
Predatory lenders use high-pressure sales tactics and steer you into high-interest loans with lots of junk fees tacked on, even though you may qualify for a better loan. High-interest rates and unnecessary fees raise the amount you must borrow, and make it hard for you to make your monthly payments.
Students classify those characteristics based on the three C's of credit (capacity, character, and collateral), assess the riskiness of lending to that individual based on these characteristics, and then decide whether or not to approve or deny the loan request.
A triggering term is a word or phrase that, when used in advertising literature, requires the presentation of the terms of a credit agreement. Triggering terms are intended to help consumers compare credit and lease offers on a fair and equal basis.