What is Predatory Lending?
Predatory lending is a blanket term for the practice of forcing or tricking people into taking out very bad loans. The term includes a wide range of practices used by unscrupulous lenders. Some examples are loans with an interest rate of 500 percent; repeated, unnecessary refinancing; or lending to someone the lender knows cannot afford the payments. The companies and people behind these types of loans often get consumers to agree to them through unscrupulous tactics like bullying, manipulation and intimidation.
Common targets of predatory lending include the elderly, particularly people who are isolated or infirm; people with bad credit or very short credit records; the poor; non-native speakers of English; and anyone who does not understand how aboveboard lending should work. These practices are illegal under federal and state laws.
If you or someone you care about has been the victim of predatory lending, contact the Louthian Law Firm today toll free at 1-888-440-3211, or go online for a free evaluation of your case.
Predatory Lending in Home and Car Loans
The most common types of predatory loans are home and real estate loans. Because homes are almost always very valuable, predatory lenders target homeowners, especially older people who have built significant equity (value) in their homes over decades. Younger people who cannot yet afford a home or who have bad credit may also be targets.
Car and truck buyers are another popular target for predatory loans; people who sign onto an unfair auto loan may be legally bound to pay several times what the vehicle is worth.
Targets for predatory loans can lose thousands and thousands of dollars, their savings, cars and jewelry, and sometimes end up being evicted from homes their families have owned and occupied for decades. It may take years and many thousands of dollars to recover from an unethical, illegal loan that took just a moment to sign.
Predatory Loan Protections Under South Carolina Law
Fortunately for South Carolinians, our state passed a law in 2004 that gives us some of the strongest protection in the nation from these abuses. The South Carolina High Cost and Consumer Home Loans Act prohibits certain abusive practices, requires some loan information to be disclosed to the borrower in writing, and caps specific types of interest and fees. Please also see the nonprofit, nationwide Center for Responsible Lending.
If you or someone you love is a victim of predatory lending, you have the right to sue the unscrupulous lender to recover your money and punish them for their wrongdoing. You should speak to the Louthian Law Firm as soon as you think you may have a lawsuit, to ensure that our attorneys can start working on your case as soon as possible. We offer free, confidential consultations to victims, who are often working with limited resources, and we never take any fees unless and until we win the case.
For a free, no-obligation case evaluation, call us today toll free at 1-888-440-3211.
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South Carolina Consumer Finance Litigation
Sub-prime loans and other predatory lending practices are a current focus for the Louthian Law Firm and ( we don’t have a formal relationship on these cases yet), Richards, Patrick, Westbrook & Brickman (RPWB). We are now seeing a greater-than-ever impact on consumers. With the recent sub-prime meltdown and increase in predatory lending, households near and far are feeling the effects – and it’s a threat that shows no signs of slowing down.
Often, lenders have securitized huge groups of loans to insulate investors from any wrongdoing by the lender – leaving the borrower trapped in a predatory loan with unfavorable terms, leading to default and ultimately foreclosure.
When times were good all kinds of players got in looking for easy money, and the easiest way to get it was to ignore the potential consequences to the consumer.
It’s fairly easy to identify a sector of the consumer finance industry that is being abused, but it’s much harder to develop the factual and legal background to bring a case to remedy that abuse. Our attorneys are specifically looking for cases that contain a set of facts that support a legal challenge to a widespread practice.
For example, a mortgage company that split fees with a company that referred business to it could be liable under the Real Estate Services Practices Act (RESPA), or a credit card company that “cross marketed” with another company by selling the financial information of its customers without their permission could be liable under the Fair Credit Reporting Act (FCRA). Where the practice is standardized and a large number of consumers are victimized in the same way, class actions may be appropriate to enforce consumers’ rights.
Big finance companies need to standardize their practices, since they view borrowers only as numbers and percentages, not as people. The flip side is that when they standardize illegal practices, they harm everyone they deal with.
Once the basic fact pattern is known, the decision on how to approach the case must be made. Class action or mass tort? State or federal law? National class or separate state actions? Where to bring the case?
We are constantly pursuing claims on behalf of borrowers who made excessive profits in violation of state and federal law. And looking ahead, the need to prosecute these types of claims shows no signs of stopping – we will be ready to lead the way.
Let us help you. For a free, no-obligation case evaluation, call us today toll free at 1-888-440-3211.