Bad Home Mortgage Signs

Are you in need of a home mortgage? How badly do you need a home mortgage? Some mortgage lenders hope youll need a mortgage very badly indeed, and when youre backed into a bad spot, theyre exactly the kind of mortgage lender you dont need. Here are the top five signs to watch out for when youre considering mortgage lenders:
* Questionable marketing tactics. Legitimate home mortgage lenders do not need to seek out borrowers; borrowers come to them. On the other hand, disreputable lenders are always on the prowl for new customers. Predatory lenders use hard sell tactics, junk mail campaigns, and telemarketing, and even more suspiciously, they market door to door. Avoid any lender who uses these marketing tactics.
* Unusually high interest rates. Interest rates on bad mortgages are usually markedly higher than the market average. Some lenders convince borrowers to accept high interest rates by targeting borrowers with credit ratings poor enough that they are hard pressed to get a home mortgage from a legitimate lender. Other lenders prefer to target inexperienced borrowers who are unaware that they are paying too much for their mortgage. Predatory lenders often suggest dealing with the high interest rate by refinancing, or "flipping," the home mortgage frequently.
* Bloated fees. Legitimate mortgage fees might look staggering on paper, but they dont come to more than 1% of the amount of the mortgage. Bad mortgages frequently come with fees of 5% or more.
* Yield spread premiums. This is a well disguised piece of financial jargon for a kickback to the broker for convincing you to accept a much higher interest rate than you are entitled to. Legitimate home mortgages never have yield spread premiums. If you are offered a home mortgage with a yield spread premium, look elsewhere. Not only have you been offered a bad mortgage, but you have been told indirectly that you are qualified to get a much better interest rate.
* Prepayment penalties. This is a charge for refinancing or paying off the mortgage early. Good mortgages rarely have any prepayment penalty, and when they do have a penalty, the term during which the penalty applies is short. However, bad mortgage lenders frequently dissuade you from refinancing with another lender by tacking on prepayment penalties that apply for three years or more after you sign for the mortgage.
If any of these signs apply to a mortgage you are offered, reject the offer and find another lender. No matter how desperate you are for a home mortgage, you dont need a mortgage as lousy as the one youve been offered. More information Mortgage refinancing | Mortgage loan | Mortgage loan |

View PDF | Print View
by: marciafreeman
Total views: 63
Word Count: 467

About the Author

For more about home mortgage, try this web site.

Comments

Add Comment