Predatory lending detection system and method therefor

• US 7,689,503 B2
• Filed: 11/13/2001
• Issued: 03/30/2010
• Est. Priority Date: 11/13/2001
• Status: Active Grant

• Current Assignee: First American Financial Corporation
• Original Assignee: Interthinx Incorporated (First American Financial Corporation)
• Inventors: Wilson, Constance A., Halper, Steven C.
• Primary Examiner(s): APPLE, KIRSTEN SACHWITZ
• Application Number:
  US09/993,072
• Publication Number:
  US 20030093365A1
• Time in Patent Office: 3,059 Days
• Field of Search: 705/38, 705/35, 707/202
• US Class Current: 705/38
• CPC Class Codes: G06Q 20/042 characterized in that the payment protocol involves at least one cheque
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/102 Bill distribution or payments
• CPC Class Codes: G06Q 20/105 involving programming of a portable memory device, e.g. IC cards, "electronic purses"
• CPC Class Codes: G06Q 20/108 Remote banking, e.g. home banking
• CPC Class Codes: G06Q 20/1085 involving automatic teller machines [ATMs]
• CPC Class Codes: G06Q 20/40 Authorisation, e.g. identification of payer or payee, verification of customer or shop credentials; Review and approval of payers, e.g. check credit lines or negative lists
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A predatory lending detection system and method are described. The system is adapted to receive information pertaining to loans, store general loan information, as well as predatory lending laws, and process the loan information to detect violations of applicable predatory lending laws. In particular, the system compares the loan information to the general loan information and to the applicable predatory lending laws, detects variances therebetween, and scores such detected variances to determine a risk category for the loan.

Claims

1. A computer-implemented method of detecting predatory lending in connection with one or more loans, comprising:

receiving information pertaining to the one or more loans using a computer system;

storing general loan information at the computer system;

comparing using the computer system the information for each loan to at least one predatory lending rule and to the general loan information to detect one or more variances therebetween, each variance having a certain degree;

scoring each variance based upon the degree thereof using the computer system, whereby knowledge of the at least one predatory lending rule on behalf of a user of the system is not required;

calculating a total numeric risk score for each loan based on scored variances using the computer system;

assigning using the computer system a risk category to the loan based on the total numeric risk score; and

displaying a computer screen including the total numeric risk score and the risk category for each loan to a user of the system.

2. The method of claim 1, wherein the step of assigning the risk category further comprises determining the risk category for each loan based on a sum of scores for each detected variance associated therewith.

3. The method of claim 1, further comprising notifying a user of the system when one or more variances are detected.

4. The method of claim 3, further comprising determining one or more steps needed to resolve each detected variance, and notifying the user of each detected variance and the one or more steps necessary to resolve it.

5. The method of claim 1, further comprising tracking the status of each detected variance associated with each loan.

6. The method of claim 1, wherein the at least one predatory lending rule includes at least one of a city, county and state rule, the loan information includes the city, county and state in which the loan is to be closed, and further comprising the steps of:

identifying the city, county and state rules associated with each loan; and

applying the predatory lending rules of the identified city, county and state to the loan information for each loan.

7. The method of claim 1, further comprising detecting fraud in connection with the loan based on the one or more detected variances.

8. The method of claim 1, wherein the method is implemented in a web-based environment.

9. The method of claim 2, wherein the step of displaying the total numeric risk score and the risk category for each loan comprises displaying a pass status indicator to a user if the sum of the scores falls within a first score range.

10. The method of claim 2, wherein the step of displaying the total numeric risk score and the risk category for each loan comprises displaying a high risk status indicator to a user if the sum of the scores falls within a second score range.

11. The method of claim 2, wherein the step of displaying the total numeric risk score and the risk category for each loan comprises displaying an investigate status indicator to a user if the sum of the scores falls within a third score range.