Upside Down Mortgage

Many people feel like they are victims of some kind of mortgage frauds, schemes or predatory lending practices. Many people with upside down mortgages are victims of predatory lending or mortgage frauds. But, what exactly is the definition of  predatory lending? And, if you think that you are a victim of a predatory lending practice, what can you do about it?

Defining Predatory Lending

(What is Predatory Lending)

Predatory lending is a term used to describe lending practices that are:

• unfair,
• deceptive, or
• fraudulent

Usually predatory lending practices are practices by some lenders during the loan origination process to take advantage of borrowers.

Victims of Predatory Lending Practices

There are many victims of predatory lending practices everywhere. A lender usually deceptively convinces borrowers to agree to unfair and abusive loan terms. The terms are not good for borrowers but the lender deceptively makes it look as if they are good or acceptable. Predatory lenders are most likely to target the less educated, racial minorities and the elderly folks who are easily convinced that bad things are good. However, victims of predatory lending are everywhere, in every state and in every country.

Examples of Predatory Lending

Some types of lending that are sometimes referred to as predatory lending include:

• payday loans,
• credit cards with unreasonably high interest rates or
• other forms of consumer debt with unreasonably high interest rates, and
• overdraft loans when the interest rates are considered unreasonably high.

What is predatory lending in the United States?

There are no legal definitions in the United States for predatory lending, though there are laws against many of the specific practices commonly identified as predatory, and various federal agencies use the term as a catch-all term for many specific illegal activities in the loan industry.

Differences between Predatory Lending and Predatory Mortgage Servicing

Predatory lending is not to be confused with predatory mortgage servicing (predatory servicing). Predatory mortgage servicing is used to describe the:

• unfair,
• deceptive, or
• fraudulent practices

of lenders and servicing agents during the loan or mortgage servicing process, post origination.

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