Educating Consumers Against Predatory Lending

In October 2001, the National Community Reinvestment Coalition established the National Anti-Predatory Lending Consumer Rescue Fund (CRF) to help victims of predatory lenders. CRF also assists homeowners at risk of foreclosure who have made good faith efforts to pay their loans but are unable to do so.

Similar to NHS of Chicago and ACORN Housing, CRF counselors work with homeowners to develop a workable budget and payment plan, and then present it to the lender in an effort to restructure the loan. Through dispute resolution, mediation, consumer counseling and financial education, CRF has helped more than 2,500 households in 17 states over the last five years.

“Early delinquency intervention is key,” says Lloyd London, director of CRF. He says that “a lot of times borrowers panic and don’t understand that contractually they have to pay the full amount every month, and right then is when the dialogue needs to be opened up.” That’s why financial education is an important element of this and other programs. Once consumers understand their financial obligations and their rights, they won’t be easily persuaded to agree to mortgages and other loans that aren’t in their best interest.

To read more about CRF and what NCRC is doing to stop mortgage lending abuse, visit www.fairlending.com.

W.P.

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