Mayors Named to National Task Force on Predatory Lending

By Eugene T. Lowe
April 17, 2000

Department of Housing and Urban Development (HUD) Secretary Andrew Cuomo announced March 30 the formation of a National Task Force on Predatory Lending. Four mayors were appointed to the task force: Boise Mayor H. Brent Coles, Chicago Mayor Richard M. Daley, Denver Mayor Wellington E. Webb and Detroit Mayor Dennis Archer.

The HUD Task Force on Predatory Lending will hold public hearings in at least four cities with the purpose of recommending strategies to combat predatory lending. The first hearing is to be held in Baltimore.

Predatory lending occurs in the subprime mortgage lending markets which provide credit to those unable to get loans in the conventional mortgage market. Predatory lending practices include excessive fees, provision of credit life insurance and prepayment penalties. Subprime lenders generally do not make government-backed loans and often operate outside of the current Federal regulatory structure.

“The economic boom which has produced the highest homeownership rates in history has a downside and that is predatory lending,” Cuomo said. “Though HUD has moved aggressively to eliminate thousands of unqualified appraisers and dozens of lenders from FHA housing programs, the simple fact is that many of these same lenders and appraisers are in the conventional mortgage market often charging exorbitant fees, imposing onerous terms and saddling families with debts they’ll never be able to retire. Just as HUD has moved to eliminate predatory lending from FHA programs, we must move and move now to eliminate them from the conventional market,” Cuomo said.

In addition to the mayors, the HUD Task Force on Predatory Lending will include Paul Reid of the Mortgage Bankers Association, Tom Downs of the National Association of Home Builders, Steve Kest of ACORN, Peter Skillern of the Community Reinvestment Coalition of North Carolina, John Taylor of the National Community Reinvestment Coalition, Gail Cincotta of the National Training Institute-Chicago, Ken Strong of the South East Community Development Corporation, Eric Belsky of Harvard University’s Joint Center for Housing, Vincent Quayle of the St. Ambrose Housing Aid Center and Los Angeles City Attorney James Hahn.

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