Business & Finance Loans

Consumer Beware: The Top 9 Ways A Lender Can Rob You of Your Equity and Money!

As the financial lending market grows, and there are more opportunities for consumers to finance homes across America, there seems to be more crooked, lying, and cheating lenders, mortgage brokers, home appraisers, and home improvement contractors who will pull every trick in the book just to cheat you of your money! The following 9 points are things a financial predator might do to cheat you blindly.
You need to look for any of these hot points when considering buying, refinancing, and even selling a home.
Although there are many honest, hard working people in the real estate industry, there are always those you must steer clear of so you don't lose all the equity in your home, are robbed blindly of your money, or forced into foreclosure or bankruptcy! These have been very serious issues that have become evident in the financial lending market among those uneducated in real estate and sometimes just over-trusting consumers.
These predators will go for anyone who will listen to there lies and not do their own research.
Always do your research and become educated before making any decisions! There are honest professionals that can help you and avoid pitfalls, or worse...
a financial predator.
Undocumented Fees A financial predator may charge you fees for products and services that simply, don't exist.
Be sure to know where all your money is going and exactly what is done for each of the fees charged.
You should be able to obtain an itemized report and description of each fee charged, or the product and service that is costing you money.
If you expect that you are being charged for fake services, simply leave the deal and find someone else.
If they can not describe each product or service clearly, or if you don't understand the product or service, be sure to check with another source as to if what they are telling you is common practice or a way to just get more money out of you.
Unfair or Discriminatory Interest Rates Interest rates charged based on other factors than your credit history and financial environment is unacceptable.
Despite the many advances we have made as a society, there are still people who charge differently according to ethnicity, social class, and individual lifestyle choices.
Make sure all rates are directly related to your financial situation and nothing else.
If you see additional points or fees for no apparent reason, and a comparable person has a much different financial plan than you do, look into it.
You need to shop around and get many quotes and loan option so you know what the current condition is for your financial situation.
Lending Too Much Money Be aware of a lender offering to lend you more than you can afford.
You may think that they are being nice by trusting you and offering you more money, but it is a scam.
They will wait until you default on your payments and take your home.
These lenders will knowingly lend you more money than you can afford so you will default.
Always do your own financial assessment so you know exactly what you can afford.
So when you approach a potential lender, you will not be duped.
There are trust worthy bank financial analysts and advisors who can help you with this.
Fake Appraisals Be aware of appraisals.
Appraisals are simply opinions of a trained and licensed appraiser of the current market value of a property based on market data.
Because it is an opinion, it can be easily increased or decreased as a lender sees fit, according to his or her best interest.
Homes can be sold for substantially higher prices with these false appraisals, so always get your own appraisal from a third party that has no interest in the property.
That way, you are more likely to get a fair deal or fair loan amount on a mortgage.
Encourage You to Lie If anyone pressures you to lie about your income, expenses, or cash available for down payment discontinue doing business.
Not only is this illegal, but it can completely ruin your financial stability.
If you make decisions that are outside your financial ability, you can literally lose everything because your home can go into foreclosure which can lead to bankruptcy if you don't have the cash reserves to pay for obligations that you make.
Always be honest and don't let them pressure you into lying just to get a better deal, which will probably hurt you in the end.
There are options for every situation and it may take more time and effort to find something that will work for you, but it is worth it.
Target Troubled Prospects Some dishonest lenders will urge vulnerable prospects to cash out of refinance offers when they really need cash for unemployment, medical or extensive debt problems.
If you are in a vulnerable position, and have many problems to attend to, do not let someone talk you into making any important or drastic financial decisions that destroy your equity or increase debt.
If you are in need of help, find a trusted source that will work with you to solve your problems and only in your best interest, not pressure you into dangerous financial positions.
Pressure You to Take a Higher-Risk Loan Know your facts before you choose a loan! A predator would urge you to take a higher-risk loan such as a balloon payment, which involves one huge payment at the end of the life of a loan, or an all interest loan that does nothing towards that actual loan itself.
Get informed and do your own research on type of loans.
There are many options that will fit your situation.
Never feel pressured into a decision.
Tell You to Refinance- Over and Over There are many great reasons to refinance, however, if you find yourself in a position that you are being asked, or even told to refinance when there is no clear benefit to you as the home-owner, don't do it! This is a tactic to strip you of your home equity.
It may look like you are getting cash out of your home that you can use freely, but your equity will be depleted and the lender will have you in his or her grasp! The more you owe a lender, and the greater debt you have, the more responsibility you have towards them.
Don't let this happen to you.
High Interest Home Improvements Some home improvement contractors can use high pressure sales tactics to get you to agree to a home improvement, and then have you finance it at a ridiculous interest rate.
The improvement could cost five times the quoted amount and the lender makes a killing, as well as the contractor! Always know the details and never allow yourself to be pressured into a contract.
Every decision you make should be on your own accord and based on researched advice.
If you feel you are in a situation where you are being preyed upon by a financial lender, broker, or whoever, get out of the situation and find someone who can really help you.
Look at qualifications, licenses, and references.
There are great people out there to help you.
Work with them, and not the crooks.

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