“A national law to fight predatory lending is long overdue, but it shouldn’t come at the expense of North Carolina homeowners. If Congress passes this law as currently written, North Carolina consumers will actually be worse off. Congress must allow our state to keep the strongest laws in the country.”
The Mortgage Reform and Anti-Predatory Lending Act of 2007 would undercut North Carolina’s stronger law against predatory home loans.
The federal bill is based on North Carolina’s landmark laws against predatory lending but it doesn’t go as far as the state’s laws to protect homeowners. For example, North Carolina law protects consumers who are victims of predatory loans even if their original lender later sells their mortgage to another company. If passed, the federal law would limit consumers’ right to take action if they’ve been harmed by bad mortgage loans and preempt North Carolina’s stronger remedies.
The measure has passed the US House and is currently pending in the US Senate. Cooper wrote to North Carolina Senators Elizabeth Dole and Richard Burr in November asking them to strengthen the bill and to eliminate any provisions that preempt North Carolina’s predatory lending laws.
Cooper helped win new state laws this year to further strengthen protections for home loans and to fight the recent rise in foreclosures. This law ensures that loans cannot be made without taking into account the borrowers’ ability to repay the loan, building on the state’s already strong laws against predatory loans.
North Carolina’s original law against predatory lending, which Cooper authored as a state senator, was the first in the nation when it became law in 1999 and has since served as a model for many other states. The law banned bad mortgage lending practices such as flipping, prepayment penalties and the financing of single premium credit insurance.