Mortgage Loans Interest Rates

Refinancing predatory mortgage loans
In communities across the country, predatory lenders, appraisers, and mortgage brokers to seek to exploit and trap uninformed potential homebuyers. Some predators sell overvalued properties using false appraisals, or deliberately lend more money than a borrower can afford to repay. Others charge high interest rates based on race, not credit history, while some assess fees for unnecessary or nonexistent products and services.

Victims of these unscrupulous lenders have had little recourse–until now. The nonprofit National Community Reinvestment Coalition helps free consumers from the trap of usurious interest rates and exorbitant mortgage payments. Working in conjunction with nonprofit community groups nationwide, NCRC is refinancing such loans through its National Anti-Predatory Lending Consumer Rescue Fund (www.fairlending.com, 800-475-6272).

The Consumer Rescue Fund offers qualified homeowners a new, low-interest mortgage, often below the prime rates and provides counseling at no charge. The fund also pays all upfront expenses, including appraisal fees and closing costs. As an incentive to get borrowers to pay on time, the interest rate drops one-quarter of a percentage point for each year of timely payments (up to a 3% discount cap).

The fund helped Maxine and Terry Wilson. In 1996, the couple bought a house in Coram, New York, through a Brooklyn developer, Toussie Family Homes. The couple paid $146,000–$21,000 more than it was worth–for a 1,200-square-foot, three-bedroom, two-bath house.