State Rep. Urges a More Aggressive Fight Against State’s Predatory Lenders
Representative Randy Johnson, a Republican from Celebration, Fla., said Wednesday that if he wins the election for Chief Financial Officer this November, he would urge legislators to crack down on predatory lending schemes that are bankrupting too many Florida homeowners.
According to the Palm Beach Post, Johnson offered up a five-point plan to combat problem and predatory Florida home loans. Among the components of his plan is a standard disclosure form that would clearly show borrowers how much their home loan would cost for each of the first 12 months.
The plan also would provide them with information about non-traditional, exotic mortgages, a quick and inexpensive dispute resolution system for consumer complaints, and better advertising regulations in the growing non-traditional mortgage field.
Johnson held up some low-interest mortgage advertisements received through faxes and e-mails Wednesday, calling them examples of how Florida home loan promises can be misleading and cause severe financial damage to many of the state’s vulnerable residents.
He also distributed copies of a Palm Beach Post report detailing struggles with high-interest loans during the recent spike in home prices and subsequent affordable housing crunch. That review found more than $25 million in Florida home mortgage loans in Palm Beach County collapsed in less than 90 days during 2005 alone.
Johnson’s opponent in the Republican primary, Senate President Tom Lee, has said that many foreclosures are more market-driven, due to the cooling off of the Florida housing market, along with high property taxes and soaring insurance premiums.
Lee, who has been closing mortgages for his residential construction company for 20 years, said the advertising concerns raised by Johnson are federal issues that state officials may not have much control over. He added, however, that the state should crack down on predatory lenders and set up a better customer dispute system.
“It’s definitely worth peeling back the layers of this issue and seeing what Florida can do,” Lee said.
