by 
Mastodon
ANSWERS: 3
-
One form of it is "loan-sharking". That is, lending money on relatively easy credit terms (no background check, low or no interest at first -- or easy initial periods in adjustable-rate loans), and then tightening the screws once the credit user is "hooked" on the loan, with an eye toward acquiring the asset at a reduced price. For example, lending money to a desperate businessman, and then eventually taking over the business later. Organized crime always needs places to launder money, so it's not so important if the business makes or loses money on its own; if they can control the books, then they can funnel money in and out and let the business front for their REAL money makers.
-
30% interest, loaning to people you know will default, refinancing to people you know will default.
-
Predatory lending references any credit/finance situation which puts the consumer in a losing position. A bank, selling a homeowner an Equity line of credit may be predatory when they will loan more than a house is worth. That is a no win situation for the homeowner. - Predatory lending also refers to interest rates. Not just high interest rates, but floating interest rates, like ARMs. - Predatory lending preys on seniors, it preys on minorities who might have a harder time obtaining credit from regular sources. It also preys on immigrants with promises of homeownership regardless of legal status. - Predatory lending can be a "balloon note", or, No Payments Due until 2010 (then, you will be expected to pay the balance of the loan). These are just some very basic examples of predatory lending.
Copyright 2023, Wired Ivy, LLC