Combating Abusive Lending
On January 7, 2004, the OCC issued a
final rule that contains a strong standard to ensure that predatory lending does
not gain a foothold in the national banking system. The OCC took this step as a
preventive measure, even though there is scant evidence of predatory practices
among national banks.
The new standard is part of a rule that
clarifies the extent to which state laws apply to national banks. The OCC also
issued on the same day a rule intended to clarify issues involving the OCC's
exclusive visitorial powers over national banks. As the sole regulator of
national banks, the OCC is in a unique position to take action on behalf of
national bank customers, no matter what state they happen to live in. While
instances of abuses are isolated, the OCC has taken quick and decisive action in
each case. Overall, the OCC has required payment of hundreds of millions of
dollars in restitution to national bank customers injured by abusive
practices.
The OCC issued a number of documents
explaining the rulemakings on national bank preemption and the OCC's visitorial
powers, including:
On February 21,
2003, the OCC issued guidance to help banks avoid predatory lending practices. A
second piece of guidance dealt with loans banks buy from third parties.
News Release
Q&As
Guidance (Loan originations)
Guidance (Purchased
Loans)
Speeches:
A number of OCC officials have addressed the
problems created by predatory and abusive lending practices. Here are some
examples:
05/24/2000
Comptroller
Hawke Outlines Program to Combat Predatory Lending |
News Release 2000-37 |
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Congressional Testimony |
WORD ASCII |
03/21/2000
Comptroller
Hawke Urges Increased Action, Education To Combat Predatory Lending
|
News Release 2000-21 |
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Speech |
WORD ASCII |
06/07/1999
Comptroller
Urges Industry to End Abusive Practices and Elevate Customer Service
Standards |
News Release 1999-51 |
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Speech |
WORD ASCII |
On October 7, 2003, The federal
Interagency Task Force on Fair Lending published a brochure on predatory lending, alerting
consumers to potential borrowing pitfalls.
A shopping
checklist is included with the brochure to assist
with comparison shopping for interest rates, payments, term of the loan, points
and fees and other costs of the loan.
You are entering an official United States government
system, which may be used only for authorized purposes. Unauthorized modification of any
information stored on this system may result in criminal prosecution.
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