Attention:  United States Senators

Ever Wish You Could Change The Rules After The Game Had Started?

In The Home Equity Game, Lenders Can Change The Rules At Any Time.

It's true.  Consumers are at a distinct disadvantage.  Currently there is no law preventing lenders from changing the terms of a new home equity loan agreement at any time.

They can increase a loan's interest rate.  Add new service charges, new fees, new penalties, new terms and conditions.  After your constituents have signed the contract.

The home equity game is unfair. The American Association of Retired Persons, Consumer Federation of America, U. S. Public Interest Research Group, and others agree.  Current law is just plain unfair, particularly since a home serves as collateral for the loan.

Consumers sign a loan agreement in good faith and agree to abide by its terms.  Naturally, they expect lenders to do the same.

Unfortunately, lenders don't have to.  Because lenders oftentimes change the terms in the middle of the game or make up new ones as the game progresses.

Senators, your vote can make lenders play fair.  Soon the Senate will vote on whether lenders can change the rules or not.  During consideration of S. 1886 (the Financial Modernization Act of 1988):

• Vote "Yes" for the Home Equity Loan Consumer Protection Act by supporting the language currently included in Title VII of S. 1886; and

• Oppose any efforts to weaken this title.

Make lenders play fair.  Don't allow lenders to change the terms after the contract is signed.

Everyone should play by the same rules.

Don't Throw Consumers A Curve.

Vote For The Home Equity Loan Consumer Protection Act.

The American Association Of Retired Persons

American Association Of Retired Persons

AARP Makes A Pitch For Consumers

WASHINGTON, D.C. -- "Don't throw consumers a curve," is the message being communicated to U. S. Senators today by the American Association of Retired Persons (AARP).

AARP today delivered baseballs to every member of the U. S. Senate to focus attention on the Home Equity Loan Consumer Protection Act (Title VII of S. 1886).  The baseballs carried a message urging Senators to support the bill and to oppose any weakening amendments.  This action is intended to counter efforts which would allow lenders to unilaterally change the terms of home equity loan agreements.

The delivery of the baseballs coincided with an advertisement run by AARP in the WASHINGTON POST yesterday.

"AARP doesn't think it's fair to allow home equity lenders to change the rules in the middle of the game or to make up new rules as the game progresses," said AARP Executive Director Horace Deets.  "Yet, this is precisely what can happen if lenders insert language into contract agreements allowing them to change terms after the agreement has been signed.  This is particularly unfair in home equity loans, since the home serves as collateral for the loan."

The Home Equity Consumer Protection Act would prohibit lenders from changing the terms of a home equity loan plan after an agreement has been entered into.  Thus, lenders would be precluded from "second-guessing" the original contract by increasing a loan's interest rates, or instituting new service charges, fees, terms, and conditions during the existence of a home equity loan agreement.

With more than 28 million members, AARP is the largest organization of people 50 and older.  The nonprofit, nonpartisan association offers a wide range of membership benefits, legislative representation at the federal and state levels, and educational and community service programs carried out through a national network of volunteers and local chapters.  AARP, based in Washington, D.C., also offers a variety of educational and advocacy programs for older workers, who make up one-third of AARP's membership.