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English-Only Financial Transactions Ripe For Rip-Offs of 25MM Americans

When you don’t speak or understand English well, applying for a car loan or mortgage can be hazardous to your financial health. For the more than 25 million people in the U.S. who are less than fluent in English, engaging in English-only financial transactions puts them at greater risk of becoming the victim of scams, being locked into undesirable contract terms and even losing their homes to foreclosure. 

The latest issue of Consumer Action News, non-profit Consumer Action’s quarterly newsletter, examines the challenges faced by consumers with limited English proficiency (LEP) and highlights multilingual resources to meet their needs.

For LEP consumers, a lack of access to essential documents and assistance in a language they understand has saddled some borrowers with predatory home loans and caused them to lose loan modification opportunities that could help save their homes.

Consumer advocates have been active in urging government regulators and others to make key financial documents available in at least eight languages (Spanish, Chinese, Vietnamese, Korean, Tagalog, Russian, Arabic and Haitian Creole) and to improve access to oral and written translation, counseling and complaint services when consumers engage in complex financial transactions.

States like California require companies marketing or negotiating certain credit, rental and homeownership agreements orally in non-English languages to provide associated contractual documents in those languages.

Government agencies are paying more attention to the needs of growing LEP communities. The Consumer Financial Protection Bureau (CFPB) has a Spanish version of its website, has created consumer education publications in eight languages and has spelled out key U.S. financial industry terms in Spanish and Chinese glossaries. HUD and the CFPB have multilingual complaint hotlines. LEP.gov (which received Consumer Action’s Excellence Award in 2014) is a one-stop-shop for limited-English resources and best practices at federal government agencies that regulate education, housing, immigration and more.

Big banks vary in making checking, credit/debit card and mortgage information available in other languages (most offer Spanish), but many provide ATM access in multiple languages and retain customers’ language preferences for future visits.
Mortgage industry leaders have begun to consider where they can offer in-language assistance that will benefit both the borrower and the lender, such as application and closing documents and multilingual customer service.

Through its trilingual hotline (Spanish, Chinese and English), Consumer Action offers advice and referrals for consumer complaints and provides free financial education and training materials in five languages (Chinese, English, Korean, Spanish and Vietnamese). To learn about Consumer Action’s in-language media and community outreach, as well as other LEP resources, see our newsletter articles.

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