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Prepayment Penalties in Subprime Loans

EACH YEAR, PREPAYMENT PENALTIES IN SUBPRIME LOANS CAUSE 850,000 FAMILIES TO LOSE $2.3 BILLION IN HOME EQUITY WEALTH. The Penalty for Improved Credit Consider this typical scenario: An African-American family gets a subprime mortgage loan for $150,000 with a 12% interest rate. After making timely payments for three years, they realize they can qualify for a better loan. However, when...

Require TILA Disclosures For Overdraft Loans

Overdraft loan programs (also called "bounced-check protection" or "courtesy overdraft protection") allow customers to incur debt when their checking account goes into a negative balance. Borrowers are charged a flat-fee per check or non-check overdraft and must bring their account to a positive balance within a short time period. The institutions that operate the programs do not disclose an annual...

A Review of Wells Fargo's Subprime Lending

Wall Street analysts praise Wells Fargo's revenue and sales growth, diversification, distribution/marketing prowess, and standout risk management. Despite Wells Fargo's success, there appear to be serious trouble spots in its subprime mortgage lending, particularly the predatory practices of Wells Fargo Financial (WFF) that victimize low-wealth consumers. While these practices have been criticized by community groups since the mid-1990s, they apparently...

Protecting Homeowners: Preventing Abusive Lending While Preserving Access to Credit

Prepared Testimony of George Brown, Senior Vice President, Self-Help and Spokesperson, Coalition for Responsible Lending before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit and the Subcommittee on Housing and Community Opportunity.

Fact v. Fiction: The Truth about Payday Lending Industry Claims

With huge profits at stake, the payday lending industry is fighting reform efforts by positioning itself as "consumer friendly," misrepresenting the facts, and circumventing state laws. Claim 1: Payday loans provide needed emergency credit. Claim 2: Payday lenders serve the working middle class. Claim 3: Customers understand the cost of this service. Claim 4: Payday loans are cheaper than other...

SB 1149 North Carolina's Predatory Mortgage Lending Law

In 1999, North Carolina became the first state to enact legislation to curb predatory mortgage lending. Over the many years since, the North Carolina law has proven its effectiveness in curtailing predatory lending while preserving a robust subprime lending market. Full Text of the Law Short Summary of SB 1149 Full Summary of SB 1149 During the first year after...

1999 NC Predatory Lending Law

Full Text of the Law Short Summary of SB 1149 Full Summary of SB 1149 In 1999, North Carolina became the first state to enact legislation to curb predatory mortgage lending. Over the many years since, the North Carolina law has proven its effectiveness in curtailing predatory lending while preserving a robust subprime lending market. During the first year after...
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