PREDATORY LENDING Law Offices of Omar Zambrano Bankruptcy Attorney
What is Predatory Lending?
Predatory lending occurs when an individual enters into a loan contract with terms and conditions that are abusive, unfair, and misleading. Although several federal and state laws are designed to prevent predatory lending, it does occur.
Predatory Lending Lawsuits
Predatory Lending can become extremely harmful when aggressive tactics are used to convince a borrower to agree to those misleading conditions. It typically takes place when a lending company, broker, or even home improvement contractor takes advantage of borrowers by deception, fraud, or manipulation.
Predatory lenders can charge excessive fees, interest rates, and pre-payment penalties and often require balloon payments. These are usually made without considering the borrower’s ability to repay the loan amount.
Although predatory lending does happen to all demographic groups, the most common people that are taken advantage of are elderly, minorities, and low-income homeowners. As a result, those victims then face financial crisis, including bankruptcy and home foreclosure.
Are you a Victim of Predatory Lending?
How can you avoid this type of deception? Before borrowing money, make sure you read all terms and conditions of the loan carefully. Evaluate your ability to repay the loan. Do not go through with a lending transaction if you can’t afford the repayment plan, if the up-front interest on the loan is high, or if the conditions are changed at the last second.
For specific transactions, you might have the right to rescind the loan if you act within 3 business days of signing the agreement. Otherwise, you may need to take additional steps to control your finances and protect your house against foreclosure.
Predatory Lending Litigation
Don't assume that falling behind on your mortgage is necessarily your own fault!
When lenders are too eager to make loans, they often willfully or unknowingly violate either the federal Truth in Lending Act (TILA) or the Real Estate Settlement Procedures Act (RESPA). The result can be a loan that the borrower cannot ultimately afford, and eventually results in foreclosure proceedings.
It's no surprise that foreclosure litigation is becoming more common now that it has been revealed that the poor lending practices of banks are so widespread.
Foreclosure litigation may help to:
Most often these suits do not go to trial, as foreclosure litigation makes the lender eager to renegotiate your loan when they realize how much is at stake.
If you have been served notice of foreclosure proceedings, contact the Law Offices of Omar Zambrano immediately for a free consultation to explore options that may save your home.
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