Predatory lending consists of abusive practices by lenders within the mortgage industry. These types of lenders strip borrowers of the equity in their home and put them in danger of foreclosing on their home. But one does not have to fall victim to predatory lenders. There are tell-tale signs that everyone should be aware of to help them avoid falling prey. They are listed below:
1. Be wary of and avoid any lender who encourages you to lie on your loan application.
2. Be sure that you are given all disclosures. Check your loan papers and be sure that the Good Faith Estimate, Special Info Booklet, Truth in Lending and HUD-1 Settlement statements are all included.
3. A red flag should be raised if any lender asks you to leave signatures or other line-items blank. Also re-check your documents to make sure that nothing has been altered or changed without your knowledge and/or approval.
4. If a lender asks you to repeatedly refinance and after each instance your monthly payments and total loan amounts increase, you may be dealing with a predatory lender. Shop around and get a new lender as soon as possible.
5. Check the fine print. If you are...
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