Table of Contents
Index of Schedules
WTC Tribute
Department and Industry Response to 9/11 Attacks
150th Anniversary and Celebration
Employee Recognition / Awards
State of the Financial Industry
Holocaust Claims Processing Office
Criminal Investigation Bureau
Enforcement Actions
Banking Development Districts
"On the Road"
Predatory Lending
Governor Pataki Addresses the Banking Department Staff
Banking Board Membership
Office Locations

Predatory Lending

Nearly three years ago, Governor George E. Pataki directed the Banking Department to launch an extensive, multi-pronged approach to combat predatory lending. In May of 1999, the Department formed an inter-divisional task force with members of the Consumer Services Division, the Mortgage Banking Division, the Legal Division and the Criminal Investigations Bureau. The task force develops and implements a multi-faceted approach to eliminate abusive lending practices in the sub prime market; namely to educate consumers, strengthen the regulation of the mortgage market, open criminal investigations, and conduct intensive examinations of sub prime lenders and mortgage brokers that work within this marketplace.

In 2001, the Department continued to enforce Part 41, the first regulation of its kind in the nation that targets high cost home loans. Part 41 was designed to balance the need for credit with the need to end abuses in the sub prime market. Through Part 41 and its multi-faceted approach, the Department is committed to eliminating the making of unaffordable loans that people cannot repay and the repetitive refinancing of loans without any apparent benefit to the borrower. In late 2001, the Department announced that Part 41 is working as reviews of the industry have shown that since Part 41's inception the cost of sub prime loans has come down, while sub prime credit remains available to help New Yorkers, who do not qualify for credit from mainstream lenders, become homeowners.

In addition to enforcement actions, the Department has organized and participated in a variety of consumer outreach projects to raise the visibility of the Banking Department as a resource for consumers. Throughout 2001, the Department participated in events at Buffalo NHS's annual homeownership fair at Erie Community College; the "Metro Expo" for prospective homebuyers at Madison Square Garden; a Homebuyer Fair sponsored by the United Neighborhood Housing Program in the North West Bronx; the Hispanic Housing Task Force Fair in Jamaica, Queens, and the State Fair in Syracuse. The Department also hosted several forums across the state to promote fair lending. The Department's consumer education materials are publicly available. They include a predatory lending video in both Spanish and English and brochures in multiple languages providing tips on how to not lose a home due to predatory lending practices.

Previous Next

 Tribute to World Trade Center Victims | Department and Industry Response to 9/11 Attacks | 150th Anniversary Celebration | Employee Awards | State of the Financial Services Industry | Holocaust Claims Processing Office Accomplishments | Criminal Investigations Bureau Accomplishments | Enforcement Actions | Banking Development Districts | The Superintendent's Travels Throughout New York State | Predatory Lending | Governor Pataki's Address to the New York State Banking Department Staff | Banking Board Membership | Schedules | Office Locations

NYS Banking Department