Facts to Know about Florida’s Fair Lending Act

Foreclosure law in Fort Lauderdale/Foreclosure law in Miami

A number of rules and regulations were adopted for the protection of consumers with regard to lending. When you take out a mortgage, by federal law you must receive a Disclosure Statement providing information detailed in federal law Regulation Z, RESPA. The Disclosure lays out information about the costs of your loan or credit so that you are able to compare those costs with those of other loan programs or lenders.

Florida Fair Lending Act

The Florida Legislature found that abusive lending was a problem in the state and enacted the Florida Fair Lending Act in 2002 to combat abusive loan making and predatory lending practices. The law prohibits practices including the following:

Charging prepayment penalties for longer than three years
Increasing interest on loans going into default
Balloon payments on loans that mature in less than ten years
Extending credit regardless of the ability of a borrower to make the payments
Making direct payments to home improvement contractors

Calling a loan due on demand, even though the borrower complied with the terms of the loan
Refinancing a loan during the first 18 months, unless there is a benefit to the borrower
Offering to originate a loan by going door to door without a prearranged appointment
Charging late fees that exceed five percent of the payment

The Florida Fair Lending Act also requires lenders to disclose facts about the loan at least three days prior to closing the deal, including the following:

A mortgage is to be placed on the home, and they could lose the home in the event of foreclosure
Interest rates and terms can vary
Borrowers should consider consulting a HUD-approved credit counseling agency or a financial advisor regarding financing of their home
Debt consolidation can be a useful tool if the borrower does not take on additional short-term debts

Loan applicants do not have to accept the loan, even though they filled out an application
Changes in loan terms require another three-day disclosure period
Property taxes and homeowner insurance are the responsibility of the borrower

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Contact Templer & Hirsch, P.A. today for answers to all your questions about Fort Lauderdale foreclosure law and Miami foreclosure law.

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