Subprime Lending and Fraudulent Predatory Lending Practices

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Welcome to the online presentation, Subprime Lending and Fraudulent Predatory Lending Practices. Subprime lending means loans to consumers with less-than-perfect credit histories. For example, someone with an irregular income who fell behind on bills, or made one or more late payments on a credit card, or had a charged-off debt or bankruptcy. Not all subprime loans are predatory. However, growing numbers of predatory lenders market their services to people who are financially distressed and are, therefore, classified as subprime. According to Consumer Reports, the recent rise in subprime lending has been driven by a rise in the number of Americans with imperfect credit files. Reasons for credit blemishes include low savings rates, high household debt levels, financial problems caused by divorce and high medical bills, and aggressive credit card solicitations with ever-larger credit lines.

Author:
Barbara O'Neill, Ph.D., CFP, AFC, CHC, CFCS (Extension Specialist in Financial Resource Management, Rutgers Cooperative Extension)

Duration:
18 minutes, 5 seconds

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