Study: NC Law Cut Abusive Loans, Not Access

The North Carolina predatory lending law has cut down on the number of loans containing abusive terms without restricting access to credit, according to a study by the University of North Carolina’s Center for Community Capitalism.The number of loans containing prepayment penalties of three years or longer, which the study’s authors said was a good sign of a predatory loan, has dropped 72%. Even while fewer such loans were made, borrowers with impaired credit had 31% greater access to loans, and subprime home purchase loans also increased 43%, keeping apace with the region, CCC said. The study used an analysis database of 3.3 million loans, provided by the Loan Performance company. It was paid for by the Center for Responsible Lending. CCC can be found online at http://www.ccc.unc.edu.