A lender targets homeowners in a specific zip code with reverse mortgage solicitations, charging upfront fees of 8% of the home's value, which are financed into the loan balance. The lender's analysis shows these homeowners have an average of $210,000 in equity but limited income and financial literacy. The loan structure results in equity being completely consumed within 7 years through fee capitalization and compound interest. Beyond equity stripping, which additional federal violation may be implicated?

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The Home Ownership and Equity Protection Act (HOEPA) if the loans meet high-cost thresholds, and potentially ECOA if the geographic targeting correlates with a protected class An 8% upfront fee on a reverse mortgage almost certainly triggers HOEPA (Home Ownership and Equity Protection Act) high-cost loan thresholds, which cap certain fees and require additional disclosures and consumer protections. HOEPA applies to closed-end refinances and home equity loans meeting fee or rate thresholds (points and fees exceeding 5% of the loan amount for loans ≥ $22,969). Additionally, if the geographic targeting of a specific zip code correlates with race, national origin, or another protected characteristic, the pattern may constitute a form of reverse redlining, implicating ECOA and the Fair Housing Act. RESPA Section 6 governs servicing transfers, not fee structures. HMDA data submission failures are separate compliance issues. Gramm-Leach-Bliley governs data privacy, not predatory lending practices.

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