Every year, misinformed homebuyers, often first-time purchasers or seniors, become victims of predatory lending or loan fraud. Below you'll find the top 10 ways to avoid becoming a victim yourself.
1. Take your time and shop around. You should be able to compare prices and houses. If a lender or broker tells you they are your only chance to getting a loan or owning a home, don't do business with them.
2. Do not sign a sales contract or loan documents that are blank or contain information that is not true.
3. Be certain that the costs and loan terms at closing are what you originally agreed to.
4. Do not be talked into lying about your income, expenses, or cash available for down payments in order to get a loan.
5. Watch out for higher-risk loans such as balloon loans, interest-only payments, and steep prepayment penalties.
6. Be careful about disclosing things like your need of cash due to medical, unemployment, or debt problems. You are very vulnerable in these cases.
7. Don't strip your home's equity by refinancing again and again when there is no benefit to you.
8. Beware of false appraisals.
9. Do not let anyone convince you to borrow more money than you know you can afford to repay. If you get behind on your payments, you risk losing your house and all of the money you put into your property.
10. Get several quotes from multiple brokers or lenders so that you know you're being charged a fair interest rate based on your credit history, not your race or national origin.
David Brumbaugh is the owner and operator of EZandFree.com. EZandFree.com provides consumers with online tools for easily obtaining free competitive Mortgage and Loan Quotes. It also serves as a mechanism by which Mortgage Brokers can obtain legitimate qualified leads from people who need their services.
