PREDATORY LENDING
The act of deceptive and illegal lending practices. Such acts include; loan fraud; illegal fees; fraudulent appraisals which misrepresent the value of a property; encouraging borrowers to lie about information on a credit application; knowingly lending more money than a borrower can afford; excessively charging higher interest rates based on race or national origin instead of the borrowers credit; pressuring borrowers into higher risk loans such as balloon mortgages, interest only mortgages, loans with high prepayment penalties, etc.; encouraging a borrower to repeatedly refinance even when it doesn't make sense.

For further details, visit HUDS web site concerning Predatory Lending and Loan Fraud.