1 post tagged “mortgages”

Foreclosure has become a serious problem in the US.  Every three months 250,000 new families will enter into foreclosure. –Mortgage Bankers Association.  Much of this crisis is attributed to the influx of predatory lenders into the subprime mortgage market, a predatory lenders playground. A market littered with lenders, appraisers, mortgage brokers, and home improvement contractors; each is out to get their own piece of the pie at the buyer’s expense.  Predatory lenders promote their loans to buyers who would not qualify for a traditional mortgage due to limited or problem credit histories.  Often this market includes those who are not knowledgeable about the home buying process yet are so desperate to buy a home they will sign anything, and fast. 

 

Some of the characteristics of predatory loans are making unaffordable loans based on the assets of the borrower rather than on the borrower’s ability to repay an obligation; inducing a borrower to refinance a loan repeatedly in order to charge high points and fees each time the loan is refinanced (“loan flipping”); or engaging in fraud or deception to conceal the true nature of the loan obligation, or ancillary products, from an unsuspecting or unsophisticated borrower –FDIC. 

 

Above anything else, if the deal sounds too good to be true chances are it is.  Ask questions.  If you feel that you’re being deceived have an attorney review the documents. If you’re an inexperienced borrower, get help from a housing counselor.  Taking a few precautionary steps will ensure that your piece of the American Dream is yours to keep.

 

Darish K. Still