Homeowners Targeted by CRA Loans
WASHINGTON -- The Federal Reserve Board recently warned the public about inquiries and complaints it is receiving related to direct mail suggesting cash grants or equity disbursements are available through a Community Reinvestment Act program.
According to the Fed, some of these solicitations may look like the Fed endorses it, which the agency does not. "These solicitations appear to be a deceptive effort to encourage consumers to apply for a mortgage loan secured by the consumer's home," the notice read. "The Federal Reserve cautions the public about loan solicitations or other offers from lenders or mortgage brokers that offer consumers cash grants or equity disbursements as part of a 'CRA Program.' No such federal programs exist and these programs are not required by the CRA."
The Fed advised that consumers should be very suspicious of conducting business with lenders or mortgage brokers that make deceptive claims.