Finance
Which of the following is an example of predatory lending that federal law prohibits?
ACharging a reasonable origination fee
BLoan flipping — repeatedly refinancing a loan to generate fees without benefit to the borrower✓ Correct
CRequiring a home appraisal
DVerifying the borrower's income
Explanation
Loan flipping is a predatory practice where lenders repeatedly refinance loans primarily to generate new fees, often stripping homeowners of equity. Federal laws including HOEPA address such practices.
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