HOW NOT TO GET GOUGED OR CHEATED ON A LOAN
In order to assist you through the mortgage maze, we have developed a Do’s and Don’ts list:
1. Check out the mortgage bank, or mortgage lender you are about to do business with. Check with the local Board of Realtors, the Better Business Bureau.
2. Has the mortgage lender given you a quote to include interest rate and fees associated with the mortgage, before running your credit report. This will allow you to get a reasonable idea of interest rates and fees before actually making formal application. Borrower’s should be honest with the lender about what they think their credit is. You should not allow the lender to obtain their credit report and should not pay any up-front fees for the quotes.
3. Once you make formal application for a mortgage (using the Federal 10-03 Application Form), inform the lender that they are required by Federal Law to provide a Truth in Lending Statement and a Good Faith Estimate within three business days of making application for the mortgage.
4. The homeowner, or potential home buyer should check Bank Rate dot com to see what the prevailing mortgage rates are in real time. BankRate.Com
1. Use a reputable local or reputable national mortgage firm, or bank. If a smart consumer wants to see what the average US mortgage rate for a 30 year, or 15 year fixed rate mortgage is, we suggest you visit BankRate.Com Keep in mind mortgage interest rates can change each day, and the best possible mortgage interest rates apply to the best possible borrowers.
2. Do not respond to unsolicited Internet mortgage companies or mortgage e-mails, or mailers you receive in the mail. According to the Homeowners Consumer Center, “We see nothing but trouble in dealing with a mortgage firm you cannot see, you have never heard of before, or you cannot check out. Some of the worst mortgage deals we have ever seen came from the Internet or via the US Mail. We are not big fans of unsolicited mortgage deals, or refinance opportunities that come to you via the Internet, or the US Mail.”
3. If you are buying a new home from a Regional or National Homebuilder Do Not Use Their Mortgage Product. According to The Homeowners Consumer Center, “Regional or National Homebuilders gouge and over-charge thousands of unsuspecting US home buyers every year by offering phony bonuses, or other less than honest gimmicks to keep the mortgage transaction in-house”.
4. You should not allow yourself to be pressured or forced to close before they completely understand the mortgage, its fees and the specifics of the proposed mortgage.