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Usury and Subprime Home Loans

In the bankruptcy practice where I work, I am seeing an increasing number clients caught in financial binds caused by usurious home loans. Oregon has an explicit exception to the statutes limiting interest and fees charged on loans set forth in ORS 82.010(4).  On the other hand, there are many state and federal statutes including RESPA and HOEPA which have provisions either restricting loan terms or requiring lenders to be explicit when disclosing the costs of a loan. When examining loan documents I sometimes find clear violations of existing laws, but far more often what surfaces is a contract which is legal, but unconscionable.

Usury, once associated with organized crime, has become institutionalized in credit-card lending, subprime home loans, and, increasingly, private student loans.  Home loans and easy credit have driven the economy for the last decade, generating obscene profits for banks and lending institutions.  Congress, meanwhile, adopted a laissez-faire attitude.  If it wasn’t obviously broken, no-one wanted to expend effort to fix it.

By |Dec 14, 2007|Categories: Uncategorized|Tags: , , , , , , , |

A Real Free Credit Report!

When is a free credit report not free?  A credit report is not really free, or at least you could easily be charged for it, if you use one of the commercially advertised websites.  The television commercial advertising this service is really a for profit venture trying to sell you a service for a fee.  You must first give them your credit card information (if you have an active credit card) and to avoid a charge you must cancel the service within a specified amount of time.

To paraphrase my friend Jay Fleischman who writes in the Consumer Help Central Blog in New York. The three primary national consumer credit reporting companies are required by a federal law, the Fair Credit Reporting Act (FCRA), to provide you with a free copy of your credit report, at least once every 12 months if you ask for it.

By |Dec 12, 2007|Categories: Uncategorized|Tags: , , , |