NAEBA To Help Consumers Battle Predatory Lending by Lew Sichelman
While the various lender organizations bicker with lawmakers and regulators - not to mention with one another - about what to do about lenders who rob owners of the equity they've built up in their homes, a group of real estate professionals has stepped to the plate in an effort to curb abusive lending practices. The National Association of Exclusive Buyer Agents has prepared a brochure to help prevent consumers from unwittingly falling prey to unscrupulous lenders. "It is our belief that predatory lending would be virtually impossible if consumers knew more about the contractual details involved in purchasing and financing a home," NAEBA President Ron Henderson said. NAEBA is an alliance of realty brokers and agents who represent only purchasers and advocate the right of consumers to be fully represented when they buy real estate. As a founding principle, the Evergreen, Col.-based association also encourages full disclosure in every and all transactions. "As we have pioneered the national effort to preserve the rights of home-buying consumers," said Henderson, who owns Fidelis Exclusive Buyer Advantage in Goose Creek, S.C., near Charleston. "We now intend to do our part to end abusive lending." The Department of Housing and Urban Development and other federal agencies have recommended bans on harmful lending practices that do not consider the borrower's ability to repay a loan and on lump-sum credit life insurance that is paid out of the proceeds of the loan or financed as part of the loan. They also want to limit the number of "points," prepayment penalties and other fees lenders charge on high-interest mortgages to people who can't otherwise obtain credit. In addition, the government has called for better consumer education and greater disclosure about the lending process, maintaining that that step alone would go a long way toward ending abusive lending practices. And NAEBA agrees. "Disclosure is a simple and uncomplicated process; it need not add to the cost of real estate financing," said Henderson. "We feel that lenders have a responsibility to disclose details about their products and services promptly, honestly and in a straightforward manner. Only in this way can (borrowers) make decisions appropriate to their circumstances." | 
