Federal agencies publish consumer brochure on predatory lending.

The federal Interagency Task Force on Fair Lending has published a new brochure that alerts consumers to potential borrowing pitfalls, including high-cost home loans, and provides tips for getting the best financing deal possible. The brochure, Putting Your Home on the Loan Line Is Risky Business, warns that regardless of whether a home equity loan is for a home repair, bill consolidation, or some other purpose, it is important to shop around.

Borrowing from an unscrupulous lender, especially one that offers a high-cost loan using the home as security, could result in the loss of the borrower's home and money. The brochure cautions that certain lenders--often called "predatory lenders"--target homeowners with low incomes of credit problems, including the elderly, by deceiving them about loan terms or giving them loans they cannot afford to repay. Before signing the credit contract, consumers are encouraged to do the following:

* Think about their financing options

* Do their homework

* Think twice before they sign a loan contract

* Know that they have rights under the law

The brochure notes that many consumers may have other options for meeting their financial needs besides taking out a home equity loan. Housing counseling and social service programs are available to assist people with financial problems.

If consumers decide that a loan is right for them, the brochure suggests talking with several lenders; comparison shopping for interest rates, payments, term of the loan, points and fees, and other costs of the loan; and having a knowledgeable friend, attorney, or housing counselor review the loan documents. A shopping checklist is included with the brochure.

The publication also reminds consumers that if they are refinancing or using their home as security for a home equity loan (or for a second mortgage loan or a line of credit), federal law gives them three business days after signing the loan papers to cancel the deal. The cancellation must be submitted in writing, after which the lender is required to return any money the consumer has paid to date.

If the three-day period has already passed and consumers believe they have been misled, the brochure suggests that they contact a state or local bar association, a local consumer protection agency, or a local fair housing of housing counseling agency.

The members of the Interagency Task Force are the Department of Housing and Urban Development, the Department of Justice, the Federal Deposit Insurance Corporation, the Federal Housing Finance Board, the Federal Reserve Board, the Federal Trade Commission, the National Credit Union Administration, the Office of the Comptroller of the Currency, the Office of Federal Housing Enterprise Oversight, and the Office of Thrift Supervision.

The brochure is available on the agencies' web sites listed below. A PDF (portable document format) version is provided on the web site so that consumer groups, financial institutions, agencies, and other organizations can download and print copies for distribution to their clients and customers. It includes a space on the back panel for organizations to provide their own contact information. A Spanish-language version of the publication will be available in the future.

Single copies of the brochure are available free of charge from the following agencies:

Department of Housing and Urban Development: The Department's web site at www.hud.gov of U.S. Department of Housing and Urban Development, 451 Seventh Street, S.W., Washington, DC 20410; Customer Service Center: [phone].

Department of Justice: The Department's web site at www.usdoj.gov or contact the U.S. Department of Justice, Civil Rights Division, 950 Pennsylvania Ave., N.W., Housing and Civil Enforcement Section, NWB, Washington, DC 20530; [phone].

Federal Deposit Insurance Corporation: The FDIC's web site at www.fdic.gov or the FDIC's Public Information Center, 801 17th Street, N.W., Room 100, Washington, DC 20434; [phone] or [phone].

Federal Housing Finance Board: The Board's web site at www.fhfb.gov and from the Federal Housing Finance Board, 1777 F Street, N.W., Washington, DC 20006.

Federal Reserve Board: The Board's web site at www.federalreserve.gov/pubs/riskyhomeloans/default.htm and from Publications Fulfillment, Stop 127, Federal Reserve Board, 20th & C Streets, N.W., Washington, DC 20551; [phone].

Federal Trade Commission: The FTC's web site at www.ftc.gov and from the FTC's Consumer Response Center, 600 Pennsylvania Avenue, N.W., Washington, DC 20580; toll free: 1-877-FTC-HELP (1-877-3824357); TTY for the hearing impaired [phone].

National Credit Union Administration: NCUA's web site at www.ncua.gov or contact Cliff Northup, Director of Public and Congressional Affairs, National Credit Union Administration, 1775 Duke Street, Alexandria, VA 22134.

Office of Federal Housing Enterprise Oversight: The Office's web site at www.ofheo.gov. E-mail requests for individual copies should be sent to ofheoinquiriesofheo.gov or call [phone].

Office of the Comptroller of the Currency: The OCC's web site at www.occ.treas.gov and from Communications, Mail Stop 3-2, Office of the Comptroller of the Currency, 250 E Street, S.W., Washington, DC 20219; [phone].

Office of Thrift Supervision: The OTS's web site at www.ots.treas.gov or contact Louise Batdorf, Office of Thrift Supervision, 1700 G Street, N.W., Washington, DC 20552; [phone].