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Finance > Insurance > Home InsuranceHome equity loans: abusive lending and how to avoid it
Posted by nick_niesen in Finance on October 29th Throwback Detroit Red Wings Jerseys , 2010
Home Equity loans were initially designed to allow individuals who had not yet paid off the full amount of their home, the ability to borrow against what portion of the home they had paid for. So for example, a couple who had been making monthly payments for many years on their 30 year lease, could use the money they had already put into their home as collateral when they needed a loan to send their child to college. So, while the initial intent of the loan is regarded by some as noble Custom Detroit Red Wings Jerseys , in practice it has served as a free-for-all for unscrupulous lenders and other scam artists.
Explaining Sub-Prime Lending
Home Equity Loans fall into a broad category known as sub-prime lending. Unlike prime lending, which is heavily regulated and offered to those living in good neighborhoods with fair to good credit, sub-prime lenders target those in bad neighborhoods with worse credit ratings. Because they offer loans to individuals who otherwise might have difficulty finding a loan, they were and are able to justify to the government the need to have greater free reign when it comes to setting the interest rates and finance charges associated with their loans.
This window, combined with the deep pockets of Home Equity Loan firms able to grease the campaigns of politicians Authentic Detroit Red Wings Jerseys , has prevented the industry from coming under the heavy scrutiny and regulation of prime lending. Consequently, what is seen in this industry is widely varying interest rates, and charges that are completely disproportionate with the risk incurred by the lending institution.
How to Protect Yourself
For the investor interested in taking on a Home Equity Loan, there are a few measures which can be taken to radically diminish the chances of being taken advantage of. The first precautionary step is to request a copy of the loan a full week before you sign it. The lending institution is required by law, to provide you with a copy of the loan many days in advance of you signing it. It is a rather simple task to ask for the loan Detroit Red Wings Jerseys For Sale , and the lending institutions response often reveals much about the quality and legality of the loan. If the lending institution says, that either the loan paperwork is not yet ready, or otherwise fails to produce the paperwork inside of a week prior to the signing, you should walk on the loan.
The catch-22, and consequently the reason why Home Equity Lenders are able to take such advantage of borrowers Cheap Detroit Red Wings Jerseys , is that often they are facing foreclosure and desperately need the loan. While your need may be very real, signing a sub-standard loan will ultimately put you in far worse shape than you ever were before.
Recognizing the Hidden Charges
The second, and potentially most important technique to prevent predatory lending, is to demand that all loan costs not be rolled into the APR, but be listed and paid by you up front. What predatory lenders do to entice individuals into taking a loan Jonathan Ericsson Red Wings Jersey , is to soak up the equity in a home and offer you a small kickback on the side. So, taking the example of our couple above, let us imagine that they have $50,000 in equity in their $100,000 home and have a fixed mortgage rate of $650 a month. They then go to a Home Equity Lender who tells them that upon signing the loan they will get $20 Darren Helm Red Wings Jersey ,000 in cash and their new interest rate will be $580 per month. What they do not tell the borrower is that they have also cashed out the other $30,000 dollars in equity and paid it to themselves in "refinancing fees." In addition, the new mortgage they receive may either be variable, meaning that as interest rates climb so will their new payment, or be back loaded Martin Frk Red Wings Jersey , meaning that by the end of the loan the payments may reach $1,200 a month.
Can Home Equity Loans be useful? Yes, but only under ideal circumstances. By and large, they are a product designed by unethical lending companies to take advantage of those desperate for a little cash now. If you plan on applying for a Home Equity Loan, it is vital that you take the two steps outlined above as well as have an experienced independent third party go over the loan and its convoluted terms with you.
MEXICO CITY， July 10 (Xinhua) -- After previous Olympiads ran into a number of complications， the 1912 Stockholm Olympic Games went off without a hitch， seen as the most successful until then.
The 5th Olympiad was held between May 5 and July 27， 1912， with 2，407 athletes， who gathered from 28 countries， although only 48 participants were women.
Stockholm built the Olympic Stadium specially for the event， making it look like a fortress and with a capacity for 32，000 spectators.
During the opening ceremony， athletes marches past Swedish King Gustaf V， who formally declared the Games open.
Stockholm 1912 was also the first place where many of today's Olympic traditions were born. For example， this marked the first time that athletes climbed the podium to receive their medals while their national flags were raised.
This was also the first time that electric timekeeping was used for athletics events.
Furthermore， professional sports journalists， a trade which was rapidly developing in Europe， covered its first Olympiad.
The International Olympic Committee also began overruling the power of host countries to determine the events being held since， at the time， boxing was illegal in Sweden.
Numerous firsts also happened during the competition， such as in the wrestling semi-final where Russia's Martin Klein and Finland's Alfred Asikainen grappled in a duel which lasted 11 hours and forty minutes. Klein ended up pinning Asikainen for the win but was too exhausted to take part in the final.
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