The incidents of all-time highs in foreclosures sweep the nation. This is a common-place in today’s local newspapers. A report written by Buris et.al. 2001, 264, claims that foreclosures increased by 2.13 percent in the fourth quarter of 2003. Since 2003 the foreclosure rates have risen in disproportionate rates. Studies conducted show that foreclosures climbing has been because there are predatory lenders whose initial intent is to foreclose.

Various studies claim the primary contributors to such alarming rise are within the sub-prime lenders. Of all the foreclosures were sub-prime loans across the country 10 times the rate of all conventional loans (MMSA 2004,273). In 2008, the numbers continue to climb. These sub-prime lenders engage in a scheme of illegal, unfair, unlawful, and deceptive practices that lead to the homeowners/real estate foreclosures.

We were victims of these lenders. In 2005 we moved to Alabama from Kentucky. Refinancing the home in Kentucky with cash out, but leaving still a substantial amount in the home. Expecting one amount for the down payment at closing with a sum left from the refinancing, we were charged down payment/fees that took its entirety. Hence, we unwittingly were subjected to the unlawful, deceptive practice. Later, we discover that both companies that had funded the two loans operated within the umbrella of the same corporate sub-prime lender.

Anyone looking for financial support should pay proper attention and invest as much time as possible before choosing any money lender. You should always look at the best Legal & Licensed Money Lender in Singapore so that you can get the list of all the credible money lenders in Singapore, thus, avoiding predatory lenders. 

Predatory lenders often trick the borrowers for home equity loans and home borrowers into accepting terms and conditions usually through aggressive sales techniques. Most do not view lenders as “sales”, but the predatory lenders use sales techniques to take advantage of borrowers. Predatory lenders rely upon borrowers’ lack of understanding, involvement in complicated transactions and contracts, and who are poor and minority population. The predatory lender seeks out and aggressively pursue those potential borrowers with financial difficulties, poor to fair credit, and issue higher-cost loans without the concern for ample income or credit for the borrower’s ability to pay for the duration term of the loan. Why? Remember, the predatory lender’s initial intent is to foreclose!

If we had privy to research we would have found “warning signals”. HUD’s web site (http://www.gov/offices) published warning signals to include, but not limited to: aggressive/deceptive marketing, make loans without ample consideration to borrower’s ability to pay, finance and other excessive fees to loan, higher rates than the borrower’s credit allow, and home equity/home improvement scams.

We experienced excessive fees and higher loan rates. For example, the additional equity that it took at closing and an interest rate 3-4% higher than the market rate. Both loans, in our second year, began to procure charges such as so-called inspection fees, charges for services not performed owed amounts in a “suspension” account, and a negative escrow account. Our contracts were set up with no escrow account. Due to veteran disability, we had no taxes on our home; our homeowner’s insurance deducted from my paycheck. Suddenly we have a negative escrow? Although we had fixed loans, both house payments were increased. Although stated contract payments were sent, payments were applied to excessive charges and fees resulting in defaults. Hence there were foreclosure threats.

Again, research would have been the cue, NHI website (http://www.nhi.org/online/issues/139/redlining.html139online) article written by Gregory D. Squires, Issue January/February, outlining practices of the predatory lender: balloon payments after requiring the borrower to pay substantial amounts prior to the balloon demand, requiring simple credit payments for credit life or other insurances, homeowners insurance where the lender requires the borrower to pay for a policy choice made by the lender, high pre-payment penalties for paying off the loan before its maturity, payment for services that may or may not been provided, and, loans based upon the value of the properties with no regard to borrower’s ability to pay. We experienced all of the above. Explanations given us for the increased payments were the lender’s choice force-placed insurances and our so-called “negative escrow”.

Our predatory lender foreclosed on the house in Kentucky; our home in Alabama under constant threat. Two years a mirage of financial and legal battles. Paying the excessive fees, but after sending an amount one agent requested, within 2-3 days another agent demanding more. In one attempt to foreclose, our home had been advertised for 30 days prior to our notice of intent. To stop the action, we wired over seven thousand dollars to the lender. Seven months later, the lender makes another attempt. We went to a lawyer. Continually they file erroneous claims and motions to take possession of our home. We are not alone, class action suits have been filed against the same sub-prime lender and loan service. Beware! Thousands are pursued and victimized daily by these predatory lenders.