- Nationally, Household International has extended $100 billion
in loans to 50 million customers through two subsidiaries: Beneficial
- Washington has 45 Household Finance offices and 36 Beneficial
- About 11,000 Washington consumers held Household International
real estate secured loans during the period covered under the
settlement (January 1, 1999 to September 30, 2002).
-- $484 million for consumers if all 50 states and the District
of Columbia participate in the settlement. Each state's share
depends on the value of loans held by that state's consumers.
Washington consumers will receive an estimated $20.6 million.
ü Prepayment penalties
-- Prepayment penalties on current or future loans will expire
24 months after a loan's creation.
ü Costs - Household
will reimburse states for their investigation and administration
- Loan Fees. For the next three years, Household will not charge
more than five percent of the total loan amount to establish
- Rate and Point Option Disclosures. Household will clearly
disclose a loan's interest rate and will tell consumers how
much must be paid in advance to lower the rate.
- Good Faith Estimates. All fees contained in a Good Faith Estimate
must be reasonably close to the amount paid at closing. Actual
fees should not differ from the estimate by more than 10 percent.
- Secured Second Mortgages. Household will not make a second
loan secured by the same property within 90 days of making the
first loan if the loan is a refinance of the property.
- Balloon payments. Household will disclose if a "balloon
payment" is needed to fully pay off a loan. Household will
also disclose the amount of that payment.
- Independent Closer. Household will use "independent closers"
to complete the loan process. An independent closer may be an
employee, but must not report to sales management nor be paid
based on loan production.
- Prepayment penalty disclosures. Household will disclose whether
a borrower must pay a penalty for paying a loan off early. Prepayment
penalties will not apply to loans older than 24 months.
- Net Tangible Benefit. No Household loan will be offered to
a borrower unless the borrower benefits from the loan.
- Repeat Refinancing. Household shall not charge fees on any
loan refinance within 12 months of the original loan.
- Insurance. Household will not require consumers to buy credit
insurance, which is intended to pay off a loan if they are unable
to make payments.
- Best rate available. Household must provide borrowers with
the lowest available rate for any loan a consumer applies and
is eligible for.