The Chicago Reporter: "Lincoln Yards investor Lone Star Funds accused of predatory lending"
Loan Star “has emerged as a lightning rod” for housing advocates who are critical of a federal program, intended to stabilize communities, which sold large pools of delinquent government-insured mortgages to private equity and hedge funds, according to the New York Times.
Distressed mortgages are disproportionately located in working-class communities of color, which have been systematically targeted for more expensive loan products, and which have suffered the greatest loss of home equity following the housing crash.
That foreclose-and-evict business model—employing predatory lending products—could be why housing counselors in Chicago found Lone Star so problematic. “They didn’t want to work with us,” said Ivé Santiago of the Northwest Side Housing Center, who helped homeowners seeking a loan modification from Caliber. “We had a very difficult time.”