Finance
Predatory lending practices that Louisiana licensees should recognize include:
AOffering below-market interest rates
BLoan flipping, equity stripping, and excessive fees targeting vulnerable borrowers✓ Correct
CRequiring 20% down payments
DVerifying borrower income
Explanation
Predatory lending includes practices like loan flipping (repeatedly refinancing to generate fees), equity stripping, balloon payments, and excessive fees that harm borrowers — especially targeting elderly or minority borrowers.
Related Louisiana Finance Questions
- A Louisiana borrower takes out an adjustable-rate mortgage (ARM) with an initial rate of 4%, a 2% periodic cap, and a 6% lifetime cap. If the index rate rises substantially, the maximum rate the borrower could ever pay is:
- A 'home equity line of credit' (HELOC) differs from a traditional second mortgage in that:
- The 'right of redemption' in Louisiana foreclosure proceedings allows the debtor to:
- What is 'negative amortization' in mortgage lending?
- Private mortgage insurance (PMI) is typically required when the buyer's down payment is:
- Under RESPA, which of the following is prohibited?
- The 'Good Faith Estimate' (now replaced by the 'Loan Estimate') was designed to:
- A Louisiana buyer's loan officer quotes a 30-year fixed rate of 7.25% with 1 discount point. One discount point equals:
Practice More Louisiana Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Louisiana Quiz →