The Home Ownership and Equity Protection Act (HOEPA)

The Home Ownership and Equity Protection Act (HOEPA) is a law that protects consumers from certain high-cost or predatory mortgage loans. It sets rules for lenders to ensure they don’t engage in practices that could trap borrowers in costly or unfair loans, especially those with very high interest rates or fees. HOEPA requires clear disclosure of loan terms and prevents risky features like balloon payments or making false promises. Its goal is to promote responsible lending and help consumers make informed decisions about their home loans, reducing the chance of financial hardship or loss of their home.