Pryce Seeks to Protect Ohio Homebuyers from Unscrupulous, Fraudulent Lenders

July 13, 2007

Pryce Seeks to Protect Ohio Homebuyers from
Unscrupulous, Fraudulent Lenders

Washington , DC – Today, legislation co-authored by Congresswoman Deborah Pryce (R-Columbus) was introduced to help remedy the growing foreclosure crisis both in Ohio and nationally. Pryce joined the bill’s other authors, House Financial Services Committee Ranking Member and bill sponsor Spencer Bachus and Congressman Paul Gillmor (R-Tiffin) to introduce the Fair Mortgage Practices Act, a bill to protect homebuyers from unscrupulous lenders or fraudulent lending tactics.

“There is no larger consumer protection issue facing Ohio,” said Pryce, Ranking Member of the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises. “ Ohio’s foreclosure rate is now three times the national average, one in six subprime loans is delinquent, and the problem is expected to worsen. While many foreclosures result from serious illnesses and job loss, it is obvious that aggressive lending, an abundance of subprime loans, and predatory lenders have helped to create a crisis in Ohio.”

The comprehensive Fair Mortgage Practices Act is enhances a number protections designed to better police the mortgage industry and ensure that consumers are armed with simplified and transparent information to make informed and financially rational decisions. Recent studies suggest that an increase in deceptive and unscrupulous lending practices have helped fuel rising foreclosure rates, along with unemployment, large medical bills, divorce, and rising adjustable rate mortgages (ARMs).

“The cost of foreclosures goes beyond the financial ruin it brings upon the borrower – the practice is now dragging our economy, devastating entire communities, and contributing significantly to the housing slump,” said Pryce. “Our legislation will help ensure that the interests of homebuyers are being protected at the point of sale and in the future.”

Foreclosure Crisis at a Glance

Ohio recently ranked #1 in the nation in percentage of houses in foreclosure, and #6 for delinquent loans.
Foreclosure rates increased 23% from ’05 to ’06.
Filings grew by double-digit rates in 68 of Ohio’s 88 counties in 2006, and statewide, they have nearly quintupled since 1995.
19.9% of Ohio’s subprime adjustable-rate loans went 90 days past due or into foreclosure during the first quarter of this year (vs. 10.1% nationwide).
2% of prime, fixed-rate mortgages were delinquent, (triple the national average).
Late payments on all mortgages in Ohio fell to 5.87% in the first quarter, a 1.38% drop from the fourth quarter last year. The national average was 4.84%, down from 4.95%.

Franklin County Stats:

Franklin County had 2,390 new foreclosure filings in the first three months of this year, compared with 2,361 in the same period last year, and 1,533 in 2005.
From 2004 to 2006, the county's foreclosures jumped by 52%.

Back to Press Releases 2007