Posted by JHyre in Ohio on January 04, 2003 at 08:57:31:
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Fed. Predatory Lending Law - Posted by John Merchant
Posted by John Merchant on January 03, 2003 at 17:09:15:
Just got an opportunity to closely examine Fed. anti-predatory act(HOEPA) of '94, 15 U.S.C.Section, and it’s my opinion that it DOES not cover the normal “Lonnie” sale on note.
“A mortgage referred to in this subsection means a consumer credit transaction that is secured by the consumer’s principal dwelling, OTHER THAN A RESIDENTIAL MORTGAGE TRANSACTION…”
and
“…the term residential mortgage transaction means a transaction in which a mortgage, deed of trust, purchase money security interest arising under an installment sales contract, or equivalent consensual security interest is created or retained against the consumer’s dwelling TO FINANCE THE ACQUISITION…of such dwlling”.
Bankers Systems, Inc.'s Katherine Iverson, Esq., agrees with my analysis. In her Summary of Anti-Predatory Lending Laws, dated Sept.18,2002, she states the following:
“Scope: Only applies to consumer, closed-end, NON- PURCHASE loans secured by borrower’s principal
dwelling”
Readers should be aware that a number of states have passed their own legislation re “predatory lending” so should check to see what State law is in state of MH deal.
It appears to me that HOEPA was enacted to try to control the predatory practice of “home equity loans”, a lot of which have been made at tremedously high interest rates with lots of points and traps, apparently designed to entrap and ensnare the unwary home owner who was in financial trouble. Not aimed at us “Lonnie” folk.
Whew!
John Merchant
Jan.3,'03