Predatory Lending

**Ellen Sanford** · 04-05-2011, 11:39 AM

I have looked up the definition for predatory lending and it seems there is no clear definition. In the last 6 months I applied for a loan online. I did not follow up with finalizing the loan with the company that I contacted initially because I didn't think I would qualify for the loan and I decided to sell the property. Unfortunately, in hindsight, I was called by the individual who worked for that company I had initially contacted after he had changed his employers and was working for a completely different company. This person wanted to know where my loan was in the process. I assumed he was still with the same company and he never indicated to me that he was with any other company. I had told the first company's loan processor that instead of refinancing the property as a primary residence I needed to refi it as an investment property. Well, when I didn't hear back I decided to let it go to see if I could sell the place. Well, not more than a week passed, when this individual called and when I told him that I had not followed through and that I wasn't sure I could qualify he told me that I was a great loan candidate and I should have no issue. So, he got me on the line with a different loan person to take a little info and get my credit card number for an appraisal. Well, eventually the failure of knowing that the property was now an investment rather than primary was discovered and the lender agreed to keep my loan application, assured me I would still qualify and advised me to take the house off the market and to get a tenant in there. 3 months later I'm still trying to qualify for this loan, I just need to get my latest Am Ex bill paid and then wait until that shows as a zero balance on my credit ap. It was weeks after this was completed and I was hitting the lender hard for a closing date that the lender disclosed they are not licensed in my state to originate the loan. Now, they are back peddling and telling me I may not qualify. The problem is I have this house on hard money, I've already had 2 extensions and I'm facing a deadline I am not sure I can extend.
Is this predatory lending?? They sought me out, assured me repeatedly the loan was and I quote "safe" up until 10 days ago. My loan application was in December, I was first set to close mid January, then February 4th and then delayed and delayed and now I don't know what will happen. 56 e-mails between me and the loan officer, repeatedly requesting status and being assured all was fine!
Weigh in! Does this make for a case of predatory lending?

**Greg** · 04-06-2011, 06:54 AM

This is one of the reasons I tell people not to use online lenders. Once they get our money they have no accountability. Local lenders have to worry about their reputation so they tend to treat their clients better.

It does not sound like you are a victim of predatory lending since they are not lending you any money.

**jumpingspidermedia** · 04-12-2011, 05:04 PM

This is one of the reasons I tell people not to use online lenders. Once they get our money they have no accountability. Local lenders have to worry about their reputation so they tend to treat their clients better.

This is one sad fact when it comes to online! There's no accountability. Background checking is necessary!

**MikeAustin** · 04-12-2011, 06:59 PM

This has been a common case for online lending although there are good ones also.

**realestategirl** · 04-12-2011, 08:46 PM

I suggest you get yourself some legal advice. From the way that you told it, this company completely misled you.

**rduncan610** · 04-28-2011, 12:57 PM

Ellen,
I'm a lawyer who represents reputable lenders.
Predatory lending usually is used to describe sticking the borrower with bad loan terms and excessive costs. There are a lot of recent regulations trying to block that sort of activity.
I think your situation is more likely classified as doing business with bad business people, although you did get stuck with paying for an appraisal.
There is not a lot you can do legally, I'm afraid to say. Two things many people don't consider when thinking about suing someone is that it costs a lot in time and money and you have to have legal "damages" that the law can award for what happened. Just because someone acted badly does not mean it's worth suing them.
Next time, deal with reputable folks like the other posters suggested.
Sorry for your troubles. If it makes you feel any better, I have a lawyer friend who got run around the same way, then got a mortgage from a local bank. I think some of these mortgage sales guys learned their trade selling used cars on credit.
Richard

**jimmyjhonson** · 04-29-2011, 05:58 AM

Changes to services from Feldman law will protect you from predatory lenders and intermediaries! your credit is probably illegal, and you may be entitled to substantial damages, whether or not you are currently in foreclosure. Predatory lending money is unfair and misleading means that some of the money lenders use fraudulent practices for borrowers to be hefty loans.

**a_mused** · 05-25-2011, 02:26 PM

Originally Posted by jimmyjhonson

Changes to services from Feldman law will protect you from predatory lenders and intermediaries! your credit is probably illegal, and you may be entitled to substantial damages, whether or not you are currently in foreclosure. Predatory lending money is unfair and misleading means that some of the money lenders use fraudulent practices for borrowers to be hefty loans.

I would love to take these guys out and go shotting with them. My parents were victims and it makes me sick to think what they do!

**mikesmith** · 05-30-2011, 04:10 AM

Originally Posted by Greg

This is one of the reasons I tell people not to use online lenders. Once they get our money they have no accountability. Local lenders have to worry about their reputation so they tend to treat their clients better.

It does not sound like you are a victim of predatory lending since they are not lending you any money.

i think local lenders with physical identity works more better

**jessicahunny3** · 07-10-2011, 12:07 PM

Predatory lending is a term that describes some of the underhanded business writing loans. These loans are usually written for poor people who will never be able to pay them off.