The legislation would improve

consumer literacy, reduce harmful mortgage lending practices, and provide

borrowers with a nationwide toll-free telephone number to receive complaints

regarding predatory lenders and create a resource database of information.

"While expanded access

to credit from both prime and sub-prime lenders has contributed to the

highest home ownership rates in the nation's history, there is growing

evidence that some lenders are engaging in predatory lending practices

- excessive front-end fees, single premium credit life insurance, and

exorbitant prepayment penalties - that make home ownership much more costly

for families that can least afford it," said Congressman Scott.

This legislation would focus

specifically on getting valuable information to the targeted victims so

they can recognize such lending schemes and would arm them with one nationwide

toll-free hotline to report such practices and receive advice. Predatory

loans are said to have grown rapidly in minority neighborhoods, often

stripping away wealth that may have taken homeowners decades or a lifetime

to accumulate.

Some communities which lack

access to traditional institutions are being victimized by second mortgage

lenders, home improvement contractors, and finance companies who peddle

high-interest rate home equity loans with high loan fees to cash-poor

homeowners.

"Although there are many

different groups with educational information regarding predatory lending

practices, there is a missing link regarding delivery of such information

to those consumers most targeted by such lenders. This bill, with its

toll-free hotline, will ensure that consumers are not helpless when the

feel they are being taken advantage of by predatory lenders. With this

bill, they will have somewhere to turn," said Scott.

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