Examples of unfair practices mentioned in guidelines against Predatory and Abusive Lending includes loan flipping and loan equity stripping. It is said that:
A.
Loan flipping may be unfair because it increases the chances of foreclosure by decreasing home equity and increasing debt burden
B.
Equity stripping is the practice of making loans secured by the consumer's home but with high, up-front fees that are financed and secured by the home
C.
Loan flipping is the practice of making loans secured by the consumer's home but with high, up-front fees that are financed and secured by the home
D.
Equity stripping may be unfair because it increases the chances of foreclosure by decreasing home equity and increasing debt burden
These options accurately describe why loan flipping and equity stripping are considered unfair practices. Loan flipping involves frequent refinancing that benefits the lender through fees and penalties at the expense of the borrower's equity, increasing the risk of foreclosure. Equity stripping involves making loans with high upfront fees that are financed, diminishing the borrower's equity in their home.
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Cam22
4 months agoJessyJazz24
9 months, 2 weeks ago