Finding
a lending company you can trust can seem overwhelming, but
if you know how to spot a scam, you’ll be one step
ahead of the game. Not all lenders believe in unethical
practices, but sometimes, you’ll be swimming with the
sharks!
Secret #1: They
sometimes recommend a loan you don’t need when business
is slow and they need to make money – like selling you
an adjustable-rate mortgage with initially low interest
rates that jump quickly.
Secret #2: They don’t
want you to get a low interest rate because, aside from
his commission, he may get an overage percentage if he
puts you in a higher-interest loan. Ask for the
daily rate card so you’ll know the lowest available
rates on all of his loans.
Secret #3: They may take
their time approving your lock-in-rate loan if they know
rates are on the rise. They control the flow of
paperwork – and your approval!
Secret
#4: APRs aren’t what you think they are.
Some lenders include their application fees and some
don’t. They vary widely according to loan amount,
PMI requirements, and whether it’s a fixed or adjustable
loan.
Secret #5: We like to
tack on fees. Watch your paperwork closely – some
lenders add illegal, outrageous fees that were
creatively concocted. Ask for
itemization.
