|
Debtors Rights
You may have found out too late that you've been the victim of predatory lending. If you were offered a mortgage that was too good to be true, particularly in light of weak or bad credit, then beware. Unscrupulous lenders love to take advantage of those consumers whom they believe are not in a position to defend themselves. As a so-called debtor, however, you do have certain rights. Many of these rights fall under the Truth in Lending Act that was enacted in 1968. Back then, the mortgage industry was a lot simpler. Its increasing complexity has allowed bad lenders to proliferate. There are many rules that lenders must still abide by, however, so it's important to know what they are before you find yourself facing bankruptcy or foreclosure. Lenders are required to
disclose all fees that they charge you. They must also
clarify all the terms used in your mortgage agreement.
This is a common way for predatory lenders to charge you
illegal fees. For instance, look out for "prepayment
penalties," insurance balances for "property
preservation," or the popular kickback to brokers called
the "yield spread premium." Though not all fees are
illegal, lenders do have to abide by stringent
disclosure laws. |
