How is this new law different from the NC Predatory Lending Law passed in 1999?
The previous law passed in 1999, the NC Predatory Lending Law, Senate Bill 1149, regulates the terms of a predatory home loan. It includes prohibitions on prepayment penalties, repeated refinancings, and upfront single premium insurance being financed into the loan. It also defines a high cost home loan, based on high fees or high interest rates. Additional restrictions then apply to these high cost loans, such as no balloon payments, consideration of the borrower’s ability to repay the loan, and required counseling before closing. This new law, the NC Mortgage Lending Act, Senate Bill 904, requires licensing for mortgage bankers, mortgage brokers and loan officers, and regulates the brokering of a home loan in NC.
