Cactus Village Community

Predatory Lending

Jul 10, 2003

Do you know the difference between fair lending and predatory lending?

The phrase predatory lending describes loans that have unusual or unnecessary penalties, refinancing fees and insurance premiums. It refers to lending practices that target vulnerable people who have equity in their homes but not a lot of cash. By making loans against the value of the property and not considering the borrower?’s ability to repay the loan, predatory lenders put homeowners at risk of losing their homes.

Predatory lending usually occurs in low-income neighborhoods where financial services are limited. The elderly and low-income home owners are the groups most often targeted. Predatory lending businesses may also include credit card companies, rent-to-own companies and ?“payday?” loan shops.

The Neighborhood Services Department and Neighborhood Housing Services of Phoenix Inc., recently presented workshops on predatory lending in the Garfield and South Phoenix Village neighborhoods. If you would like more information about predatory lending call Neighborhood Housing Services of Phoenix at

(602) 258-1659. . . ☺