Predatory Lending | David H. Kaplan

New Jersey Predatory Lending Lawyer


In New Jersey, foreclosure rates are rising and homeowners are looking for solutions to protect their homes. Unfortunately, this stressful situation leaves people most vulnerable and other people are looking to capitalize on that vulnerability. Predatory lending techniques have forced many people out of their houses and all of the equity they may have in their home.

If you think you have been the victim of predatory lending techniques after reading the following list, contact the law office of David Kaplan to protect your rights and interests.

  1. Were you persuaded by your Lender into making a false statement on your loan application?
  2. Were you convinced by your Lender to borrow more money than you know you can afford to repay?
  3. Did your Lender ask you to sign a blank document or a document containing blanks?
  4. Were you advised by your Lender to sign documents that you did not understand?
  5. Did your Lender make you a promise that they did not honor or provide a mortgage loan with terms other than you thought you had agreed to?

Predatory Lending Laws

Several laws are designed to protect consumers against predatory lending practices. At the federal level, the Truth in Lending Act (TILA) requires lenders to disclose the annual percentage rate and loan terms, and the Home Ownership and Equity Protection Act (HOEPA), which is an amendment to TILA was designed to identify predatory mortgage loans. Additionaly, other consumer protection laws such as the Federal Trade Commission Act (FTC Act), have provisions that deter predatory lending practices.

Attorney for Predatory Lending

Predatory Lending Signs


Here are some signs of predatory lending:

  • Steering and targeting
  • Mandatory arbitration
  • Kickbacks to brokers
  • Abusive prepayment penalties
  • Excessive fees

Predatory Lending Practices

Here are some common Predatory lending practices:

  • Hidden balloon payment: At the beginning, you believe that your loan is a low rate loan that will require you to make minimal monthly payment. Nonetheless, at closing, you realize that you will have to refinance within a few years because it is a short-term loan.
  • Packing: You receive a loan that includes charges for services you neither requested nor needed. This often makes the borrower believe that in order to qualify he/she must purchase credit insurance and finance it into the loan.
  • Loan Flipping: The lender refinances the loan with a new high cost and long-term loan. You must pay assorted fees and points every single time the lender flips the existing loan.
  • Bait-and-switch scheme: The lender gives you a loan that is different from the loan and interest rate that he/she promised. At times, the lender does not increase the interest rate for several months after you have you have begun making payments.
  • Equity Stripping: The lender gives you a loan based on your home’s equity. He/she does this without considering whether you have the ability to make the payments. If you do not pay, you risk losing your home.
What is Predatory Lending

Predatory Lending Charges


It is possible to file charges against a lender who engages in abusive practices. You may be able to seek the following compensation i,f with the help of a skilled attorney, it is determined that you have been the victim of predatory lending:

  • Statutory damages (finance charges plus up to 10%)
  • Punitive damages for malicious or reckless violations
  • Attorney fees

If you are charged unusually high interest rates, excessive fees, or any other unfair and unacceptable charges, you have the right the file a lawsuit so that you receive payment for your losses.

If you live in NJ and you are seeking legal advice, contact us at the Law Office of David H. Kaplan and get to learn more about predatory lending.

Predatory Lending Laws