"Effects of Predatory Lending on Consumers" The purpose of this paper is to explain the negative effects of predatory lending on low-income consumers.

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Effects of Predatory Lending on Consumers


Courtney Sims

Basic Composition 1101, Section 144

Mrs. Gale Bruce

27 April 2006�


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Thesis: The absence of an established credit history and a viable understanding of its financial impact can leave an unsuspecting consumer vulnerable to predatory lenders.

I. What is Predatory Lending?

A. Predatory Lending is a lending practice that takes advantage of

vulnerable borrowers, such as minorities, the economically

disadvantaged or the elderly.

Credit is more readily available in the United States than ever


II. There are many unfair or abusive practices in the form of predatory lending.

A. There are seven types of Predatory Lending.

B. The validity of predatory lending.

III. Who is affected by Predatory Lending?

A. The economically disadvantaged, minorities, elderly, and college students are primarily affected by predatory lending.

B. Disparity is shown in comparable neighborhoods by white and minority consumers.

IV. Predatory Lending can be minimized with better educated consumers and legislation.

A. Federal and State level governments should enforce existing anti-

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predatory laws and make new mandates against predatory lending practices.

B. Consumers should be educated by doing research so they can identify

predatory lending practices and learns how to avoid them. �

C. Those already in debt should seek help with a credit counseling agency.

D. Banks and lending institutions must work with consumers by making

financially sound loans in a more equal way, so that people can enjoy

affordable mortgages.

VI. Predatory lending is widely used across the United States. Knowledge sharing that includes educating the young to be financially responsible to consumer credit counseling should help relieve the occurrence of predatory lending.



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Effects of Predatory Lending on Consumers

"No money down!" "Bad credit, no problem!" This is broadcasted to...