Studies point to loan inequities

The Center for Responsible Lending, a nonprofit group, completed two studies showing predatory lending practices in minority neighborhoods. One study found that in minority neighborhoods, borrowers with subprime loans, who typically have blemished credit records, were 35% more likely to have prepayment penalties than were subprime mortgage holders living in neighborhoods with a low concentration of minorities.

The study was based on an analysis of 1.8 million loans from across the country.

The other study found that borrowers with subprime loans with prepayment penalties did not get lower interest rates than similar borrowers without prepayment fees. In some cases, the borrower with prepayment penalties actually paid higher interest than those without penalties tied to paying off the loan.