facebooktwitterRSS
- Advertisement -
  • Most Commentedmost commented up
  • Most Emailedmost emailed up
  • Popularmost popular up
- Advertisement -
 

« News Home

YOUNGSTOWN Seminar guests deliver warning about predatory mortgage lenders



Published: Fri, November 9, 2001 @ 12:00 a.m.



THE VINDICATOR, YOUNGSTOWN

The speakers said predatory lending practices have caused many to lose their homes.

By CYNTHIA VINARSKY

VINDICATOR BUSINESS WRITER

YOUNGSTOWN -- Tiffaney Tensley knew her first house needed repairs when she negotiated the mortgage in July, but the loan officer said she could get a bank home improvement loan to make the improvements.

Now, with winter approaching, Tensley has been forced to move in with her mother. Her old furnace leaks carbon monoxide at unsafe levels and the bank won't lend her money to replace it -- officials now say she'll have to pay on the mortgage for a year before they'll approve another loan.

"I feel like I was misled," said Tensley, 32, a South Side resident. "I can't believe the bank loaned me the money to buy the house but they won't lend me the money to make it livable."

Tensley and her mother, Beverly Gibbs, were among about 20 attending a seminar on predatory mortgage lending sponsored by the Coalition for Community Reinvestment Thursday at Oakhill Renaissance Place.

"I want to be careful," Tensley said. "I can't afford any more problems."

Advice: Lloyd Lamm, senior vice president of operations at Metropolitan National Bank and a seminar speaker, said consumers must take the time to educate themselves and ask questions if they want to avoid being victimized by unscrupulous lenders.

"What you don't know can hurt you," Lamm said, stressing the need for consumers to ask questions and to educate themselves on financial matters.

"It's morally and ethically wrong to lend people more money than they can afford to repay," he said. "You can still make a good living in the financial services industry and do what's right."

On the rise: Predatory lending is on the rise across the country, said Charles Bromley, a spokesman for the Metropolitan Strategy Group in Cleveland, and usually takes aim at low-income and elderly homeowners.

He said the lenders use high pressure tactics to persuade the homeowners to take on a new mortgage, often to finance needed home repairs, to consolidate credit card debt, or both. What the lenders do not mention is that the borrower will be paying more for a longer time and may be committing to a high balloon payment later.

If the consumer misses a payment, the predatory lender forecloses on the house.

Bromley said demographic studies show the number of foreclosures in inner-city areas across Ohio has increased dramatically in the past four years, largely due to predatory lending, and the sluggish economy is likely to produce even higher numbers.

Definition: Atty. Cherie Howard of Northeast Ohio Legal Services said there is a place for subprime lenders who lend to people with credit problems, and they have the right to charge higher interest rates and fees to offset their higher risk. What constitutes predatory lending, however, is failure to explain the loan and its costs to the lender, switching the terms at the last minute, high pressure tactics and other practices which are either illegal or unethical.

Bromley argued that subprime lenders should be taking a more active role in fighting the predatory practices of some lenders.

"What has made me angry is that the pillars of the community....do not take on these practices. They're not willing to tell them to stop all the garbage," he said. "If they were willing, it would stop tomorrow."




Comments

Use the comment form below to begin a discussion about this content.


News
Opinion
Entertainment
Sports
Marketplace
Classifieds
Records
Discussions
Community
Help
Forms
Neighbors

HomeTerms of UsePrivacy StatementAdvertiseStaff DirectoryHelp
© 2014 Vindy.com. All rights reserved. A service of The Vindicator.
107 Vindicator Square. Youngstown, OH 44503

Phone Main: 330.747.1471 • Interactive Advertising: 330.740.2955 • Classified Advertising: 330.746.6565
Sponsored Links: Vindy Wheels | Vindy Jobs | Vindy Homes | Pittsburgh International Airport