Predatory lending is still out there and buyers need to be aware.
One of my clients decided to go with the services of a nice young man who contacted her by phone. He promised her a low interest rate along with many other enticements. She contacted me long after she had begun the loan process with Justin, her trusted lender.
It turns out that the interest rate promised is not even in the ball park of what is in the loan docs, the down payment has since increased from $30,000, to $50,000 and the loan fees for a $152,000 loan are in excess of $7500. Also, my client had no idea she was buying down her interest rate, which isn't cheap.
California is one of the 25 states that has adopted anti-predatory lending laws. These laws usually describe one or more classes of "high-cost" or "covered" loans, which are defined by the fees charged to the borrower at origination or the APR. While lenders are not prohibited from making "high-cost" or "covered" loans, a number of additional restrictions are placed on these loans, and the penalties for noncompliance can be substantial. However, this did not stop Justin from lying and in my opinion, overcharging. When I asked the owner of his company if they could lower some of their fees, he said, "Hey, everybody has to make a buck." Gee, how professional.
Buyers, there are so many wonderful mortgage brokers and lenders out there right now who actually have your best interest at heart. When choosing a lender, work with someone that has been referred by a trusted source. Make sure they've had a personal experience with that lender. Make sure you get all the promises made on a good faith estimate.
I've blogged about it before, and I'll continue to do so...a good lender is worth their weight in gold, now more than ever. If you need a referral to an honest, hardworking mortgage professional in my market, do not hesitate to call me... there are several.
I am here to assist you with your real estate needs!
 Brought to you by Fran Gatti at  THE REDWOOD COAST REAL ESTATE CONNECTION Bus: 707-464-5400, Cell: 707-218-8162 Email: fgatti@charter.net Website: FranGattiHomes.com My Blog: Fran's Blog Fran is the #1 buyer's agent for 2007per CCMLS |
DelNorteCountyREOForSale.com & REOAgent95531.com
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