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1431Type of Legislation: Senate Resolution SRIntroducing Body: SenateIntroduced Date: 20000601Primary Sponsor: JacksonAll Sponsors: Jackson and McConnellDrafted Document Number: l:\s-res\dj\003lend.dmb.docDate Bill Passed both Bodies: 20000601Subject: Mortgage loans, unfair predatory lending practices; Senate to study problems of; Banks, Property, General AssemblyHistory Body Date Action Description Com Leg Involved ______ ________ ______________________________________ _______ ____________ Senate 20000601 Introduced, adopted Versions of This Bill
TO HAVE A SUBCOMMITTEE OF THE SENATE BANKING AND INSURANCE COMMITTEE STUDY THE PROBLEMS ENCOUNTERED BY LOW INCOME BORROWERS SEEKING HOME EQUITY AND MORTGAGE LOANS, AND TO PROVIDE THAT THE SUBCOMMITTEE MAKE RECOMMENDATIONS TO THE SENATE REGARDING LEGISLATION TO REMEDY UNFAIR PREDATORY LENDING PRACTICES IN SOUTH CAROLINA.
Whereas, Federal Reserve Chairman Alan Greenspan has recently criticized the growing practice by some mortgage and home-equity lenders of seeking low-income borrowers and charging unfairly high fees and interest; and
Whereas, recent congressional hearings have indicated an increase in aggressive sales tactics and excessively high interest rates that target vulnerable segments of the population; and
Whereas, U.S. Housing Secretary Andrew Cuomo has testified to the Congress that predatory lending is a national crisis; and
Whereas, numerous states are considering legislation to curb predatory lending practices and North Carolina passed predatory lending legislation in 1999; and
Whereas, a recent study of the 1998 Home Mortgage Disclosure Act revealed that consumers in South Carolina's rural low income and minority communities are increasingly turning to high interest lenders to get credit for buying a home or using home equity for the other borrowing purposes; and
Whereas, an analysis of sub-prime housing loans by Fannie Mae, a major institutional investor in the secondary mortgage market, demonstrated that thirty percent of these borrowers would have qualified for market rate interest; and
Whereas, there are currently no legal protections in South Carolina to guard against predatory lending practices and excessive rates and fees for mortgage loans. Now, therefore,
Be it resolved by the Senate:
That a subcommittee of the Senate Banking and Insurance Committee evaluate the problem of predatory lending in South Carolina and make recommendations for protecting consumers from abusive lenders. This subcommittee will be made up of at least five Senators appointed by the Chairman of the Senate Banking and Insurance Committee. The subcommittee shall report to the South Carolina Senate by January 31, 2001, regarding the findings of the subcommittee.
Be it further resolved that the Senate of the State of South Carolina, by this resolution, recognizes the problems encountered by low income borrowers seeking home equity and mortgage loans and seeks to remedy unfair predatory lending practices in South Carolina.
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