Predatory loan lending is just the way it sounds, dangerous and manipulative. The last thing you want to do is find yourself falling into one of these financial traps. Some people are unable to escape and can find themselves falling quickly into bankruptcy. Do not panic if this is you. Talk to one of our experienced Kingsport bankruptcy attorneys to figure out what financial options you may have for bankruptcy.
ALL YOU SHOULD KNOW ABOUT PREDATORY LENDING
The reason you want to avoid predatory lending is because of how much money you could lose in the long run. Predatory lending happens when a lender or creditor takes advantage of borrowers. This tends to happen because lenders manipulate a borrower’s lack of financial knowledge.
Some of the most common predatory lending tactics include:
- Withholding information that could help you
- Charging higher fees than necessary
- Adding in other loan costs you do not need
- Manipulating you into switching to a higher interest loan with supposedly better benefits
- Using complex language to confuse you into an unfair deal
- Telling you false information about loans or debt
There are also specific strategies lenders might use to trick you into accepting deals that could harm you. A common example is signing you up for a balloon mortgage. This involves having you refinance a mortgage with lower initial payments but high payments later. What happens is the person can no longer make payments when they increase, and the lender has the person refinance again.
HOW TO AVOID PREDATORY LENDING
Despite how tricky predatory lenders may seem and how complex financial jargon is, there are solutions. There are ways to avoid predatory lenders as long as you follow the right tips. One of the most effective ways is to learn more about finances. Some programs offer free financial education.
Golden rules can also help. Never accept a deal you know you cannot afford now or in the near future. Ask for a second opinion if you feel have suspicions about a deal offered by your lender. Be cautious about signing anything before reading and asking questions first.
Loan lenders and creditors do have to follow the law. Any use of misleading loan lender representation by a loan lender could place your lender in legal trouble. This means misinformation or deception involving:
- Amount of money
- The legal status of your debt
- Threats that are unwarranted
- Falsely accusing someone of a financial crime
You could potentially take legal action against a negligent debt collector who commits these acts. This could mean compensation for any damages you suffered as a result.
BANKRUPTCY LAWYER IN KINGSPORT, TN
Paying back loans may not always be manageable in times of financial crisis. Some people can fall into bankruptcy after going through predatory loan lending. Consider calling us at Tom Bible Law today by dialing (423) 690-7712 to talk with one of our experienced lawyers. Our dedicated team of Tennessee bankruptcy lawyers might be able to help you escape your financial crisis. You can find us located throughout the Tennessee cities of Chattanooga, Kingsport, and Tullahoma.