The federal
Interagency Task Force on Fair Lending has published a Spanish-language version
of a brochure that alerts consumers to potential borrowing pitfalls, including
high-cost home loans, and provides tips for getting the best financing deal
possible. The brochure, Utilizar su hogar como garantía para un préstamo es
arriesgado (Putting Your Home on
the Loan Line Is Risky Business), warns that regardless of whether a home
equity loan is for a home repair, bill consolidation or some other purpose, it’s
important to shop around.
Borrowing from an unscrupulous
lender, especially one that offers a high-cost loan using the home as security,
could result in the loss of the borrower’s home and money. The brochure cautions that certain
lenders--often called “predatory lenders”--target homeowners, including the
elderly, with low incomes or credit problems by deceiving them about loan terms
or giving them loans they cannot afford to repay. Before signing the credit contract, consumers are encouraged to
- Think about their financing
options
- Do their homework
- Think twice before they
sign a loan contract
- Know that they have rights
under the law
The
brochure notes that many consumers may have other options for meeting their
financial needs, including housing counseling and social service programs.
If
consumers decide that a loan is right for them, the brochure suggests talking
with several lenders; comparison shopping for interest
rates, payments, term of the loan,
points and fees, and other costs of the loan; and having a
knowledgeable friend, attorney, or housing counselor review the loan
documents. A shopping checklist is included
with the brochure.
The
publication also reminds consumers that if
they are refinancing or using their home as security for a home equity loan (or
for a second mortgage loan or a line of credit), federal law gives them three business
days after signing the loan papers to cancel the deal. The cancellation must be submitted in
writing, after which the lender is required to return any money the consumer
has paid to date.
If the three-day period has already passed and consumers
believe they have been misled, the brochure suggests that they contact a state
or local bar association, a local consumer protection agency, or a local fair
housing or housing counseling agency.
The members
of the Interagency Task Force are the Department of Housing and Urban
Development, Department of Justice, Federal Deposit Insurance Corporation,
Federal Housing Finance Board, Federal Reserve Board, Federal Trade Commission,
National Credit Union Administration, Office of the Comptroller of the
Currency, Office of Federal Housing Enterprise Oversight, and Office of Thrift
Supervision.
The
brochure is available on the agencies’ web sites listed below. A PDF (Portable Document Format) version is
provided on the web site so that consumer groups, financial institutions, agencies,
and other organizations can download and print copies for distribution to their
clients and customers.
Single copies of the brochure in
English or Spanish are available free of charge from the following agencies:
Department of Housing and Urban Development: The
Department's web site at http://www.hud.gov or U.S. Department of Housing and
Urban Development, 451 Seventh Street, S.W., Washington, D.C. 20410; Customer
Service Center: (800) 767-7468.
Department of Justice: The Department's web site at http://www.usdoj.gov/crt/housing/index_esp.html
or contact the U.S. Department of Justice, Civil Rights Division, 950
Pennsylvania Ave., N.W., Housing and Civil Enforcement Section, NWB,
Washington, D.C. 20530; (202) 514-4713.
Federal Deposit Insurance Corporation: The FDIC's web site
at http://www.fdic.gov or the FDIC's Public Information Center, 801 17th
Street, NW, Room 100, Washington, D.C. 20434; (877) 275-3342 or (202) 416-6940.
Federal Housing Finance Board: The Board's web site at http://www.fhfb.gov
and from the Federal Housing Finance Board, 1777 F Street, N.W., Washington, D.C.
20006.
Federal Reserve Board: The Board's web site at http://www.federalreserve.gov/pubs/riskyhomeloans/riskyspanish.htm
and from Publications, Stop 127, Federal Reserve Board, 20th & C Streets, N.W.,
Washington, D.C. 20551; (202) 452-3245.
Federal
Trade Commission: The FTC's web site at http://www.ftc.gov and from the FTC’s
Consumer Response Center, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580; toll
free: 1-877-FTC-HELP (1-877-382-4357); TTY for the hearing impaired (866) 653-4261.
National Credit Union Administration: NCUA's web site at http://www.ncua.gov
or contact Cliff Northup, Director of Public & Congressional Affairs,
National Credit Union Administration, 1775 Duke Street, Alexandria, Va. 22314;
(703) 518-6330.
Office of Federal Housing Enterprise Oversight: OFHEO’s web site at http://www.ofheo.gov/consInfo.asp. E-mail requests for individual copies should
be sent to ofheoinquiries@ofheo.gov or call (202) 414-6922.
Office of the Comptroller of the Currency: The OCC's web
site at http://www.occ.treas.gov and from Communications, Mail Stop 3-2, Office
of the Comptroller of the Currency, 250 E Street, S.W., Washington, D.C. 20219;
(202) 874-4700.
Office of Thrift Supervision: The OTS's web site at http://www.ots.treas.gov
or contact Louise Batdorf, Office of Thrift Supervision, 1700 G Street, N.W.,
Washington, D.C. 20552; (202) 906-7087.
# # #
If you wish to link to the Federal Reserve's web site the link will be:
http://www.federalreserve.gov/pubs/riskyhomeloans/riskyspanish.htm
HUD Michael Fluharty
(202) 708-0685 Ext. 6605
DOJ Casey
Stavropoulos (202) 514-2007
FDIC David Barr (202) 898-6992
FHFB Carter Wood
(202) 408-2817
FRB Susan
Stawick (202) 452-2955
FTC Brenda
Mack (202) 326-2182
NCUA Cliff
Northup (703) 518-6330
OCC Dean DeBuck (202) 874-5770
OFHEO Corinne Russell (202) 414-6921
OTS Erin
Hickman (202) 906-6913