Senate Banking Committee Press Release

FOR IMMEDIATE RELEASE:	CONTACT: JESSE JACOBS, RIANNA BROWN
Monday, July 23, 2001	202-224-4524

CURTAIN TO RISE ON PREDATORY LENDING HEARINGS

Saying that "predatory lending practices represent a frontal assault on homeowners all over America," Senator Paul S. Sarbanes (D-MD), Chairman of the Committee on Banking, Housing and Urban Affairs, has announced that the Committee will hold two hearings on "Predatory Mortgage Lending: The Problem, Impact, and Responses."

Predatory lenders typically target vulnerable people with equity in their homes. They underwrite the property instead of establishing the borrower's ability to repay the loan. The brokers or lenders make their money by charging extremely high points and origination fees, and by "packing" other products into the loan, including up-front premiums for credit insurance, for which they get significant commissions. The financing of these fees greatly increases the balance of the loan and results in the borrower getting into financial trouble. These loans often contain mandatory arbitration clauses that prevent victims from pursuing their claims in court.

Testifying at the first hearing will be four victims of predatory lending. Other affected and interested parties will also testify.

The first hearing is scheduled for:

THURSDAY, JULY 26, 2001
10:00 A.M.
538 DIRKSEN SENATE OFFICE BUILDING

Scheduled to appear before the Committee to tell their stories are:

Ms. Carol Mackey, of Rochester Hills, Michigan;
Mrs. Mary Ann Podelco, of Montgomery, West Virginia;
Mr. Paul Satriano, of St. Paul, Minnesota; and
Mr. Leroy Williams, of Philadelphia, Pennsylvania.

They will be followed by:

The Honorable Thomas J. Miller, Iowa Attorney General;
Mr. Martin Eakes, President and CEO, Self-Help Credit Union;
Mr. Stephen W. Prough, Chairman, Ameriquest Mortgage Company; and
Professor Charles Calomiris, Professor of Finance, Columbia Business School, and Co-director
Project on Financial Deregulation, American Enterprise Institute.

The Committee will then turn its attention to hearing from advocacy groups and industry associations at a hearing on:

FRIDAY, JULY 27, 2001
10:00 A.M.
538 DIRKSEN SENATE OFFICE BUILDING

Scheduled to testify at the session are:

ADVOCACY REPRESENTATIVES:

Mr. Irv Ackelsberg, Managing Attorney, Community Legal Services, Inc.,
testifying on behalf of the National Consumer Law Center, Consumers Union, and Consumer Federation of America;

Mr. William Novelli, Executive Director, American Association of Retired Persons;

Mr. David Berenbaum, Senior Vice President - Program and Director of Civil Rights, National Community Reinvestment Coalition;

Mr. Wade Henderson, Executive Director, Leadership Conference on Civil Rights; and

Mr. Mike Shea, Executive Director, ACORN Housing.

INDUSTRY ASSOCIATIONS:

Ms. Judy Kennedy, President, National Association of Affordable Housing Lenders;

Mr. John A. Courson, Mortgage Bankers Association;

Mr. George Wallace, Counsel, American Financial Services Association;

Mr. Neill Fendly, Immediate Past President, National Association of Mortgage Brokers; and

A representative from the Credit Union National Association

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