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There are lending practices that are abusive and predatory in nature. How can you identify these? Below are questions that could help you determine fraud in lending. If you answered “yes” to any of the questions, contact the appropriate agency/agencies.

The information below will help you better determine if you have been a victim of mortgage fraud or predatory lending.

Have You been a Victim of Mortgage Fraud?

• Have you been encouraged to falsify certain information on your loan application?
• Have you been asked to leave certain signature lines blank on a loan form?
• Has there been any alteration/s made to the information you supplied in your mortgage loan application?

Indications of Predatory Lending

Where you not given a copy of any of the following disclosure agreements?

• Good Faith Estimate
• Special Information Booklet
• Truth in Lending
• HUD-1 Settlement Statement
• Have you refinanced your mortgage several times? In each instance, has your monthly mortgage payment and/or total amount owed increased?

• Do any of your mortgage documents say that when your payments are late, your interest rate will change to accommodate “daily interest” that you need to pay?
• If you want to pay off or refinance your loan, are there any pre-payment penalties indicated?
• Is your loan amount higher than your home’s value?
• Do you have any unexpected costs in your settlement that were not discussed with you prior to the settlement?
• After the settlement, did you find your monthly mortgage payments to be higher than you anticipated based on the initial disclosures?
• After making a series of low payments to your loan, there is still a large lump sum or “balloon payment” due to your entire loan balance. Will you need to refinance thru another loan to pay that lump-sum?
• Were you encouraged or required to get credit life insurance? Insurance that will repay the debt in the event of a death or disability.

Note: Credit insurance is optional and should not be imposed to borrowers. You must decide carefully whether you are going to purchase credit insurance because it considerably affects the cost of the loan transaction.

MBA and its fellow supporters actively fight to control, if not eliminate, predatory lending. In fact, borrowers are being made aware that there is a Borrower’s Bill of Rights. This gives the borrowers some form of protection against predatory lenders.

Federal Predatory Lending Laws
The following are laws now in effect at the Federal Reserve that gives you rights on certain issues during the closing process:

Real Estate Settlement and Procedures Act (RESPA)

This requires disclosure of mortgage processing transactions and other fees that could affect the cost of settlement services. It is a consumer protection statute, enforced by HUD, that aims to make consumers well-informed in the home buying process.

Truth in Lending Act (TILA)

Enacted under the Consumer Credit Protection Act in 1968, which requires creditors to disclose information to consumers in relation to why they are being charged, what for, and how much.

State Predatory Lending laws
Predatory lending laws can vary from state to state. Know the laws in your area that protects consumers against abusive lending practices like excessive fees and rates. High fees may compromise pre-payment penalties and credit life insurance.

List of fraudulent home loan modification practices
Desperate home owners would potentially jump to every opportunity to get a mortgage modification to avoid being kicked-out of their homes. It is not surprising, that over-promising practices will start to occur and loan modification companies will take advantage of homeowner’s vulnerability.

Your Guide To Detecting Loan Modification Fraud

• The “high-pressure, cash-up-front” type of sales business tactics. Be suspicious of pushy salesman and mortgage modification companies that require up front fees..
• Never pay a fee for housing counseling services.
• Never sign anything. Unless you are working directly with your mortgage company, do not sign anything, such as, a transfer of deed.
• Never submit mortgage payments other than to your mortgage company.

Be alert. Remember that the official place to go for mortgage modification services is the governments Making Home Affordable website. You can find information related to the mortgage modification process. In reality, fraud does not only occur in mortgage modifications. Oftentimes, it starts from the moment a borrower shops for a loan.

Get your Free Do It Yourself Loan Modification Kit. This free loan modification kit includes everything to Stop Foreclosure and Save Your Home with a loan modification. Includes Loan Modification Worksheets, Loan Modification Forms, Detailed Step-by Step instructions, lender Rolodex, foreclosure timelines, over 50 bank specific forms And Much More! Absolutely Free!Visit our website for How to articles, mortgage calculators, free sample hardship letters, foreclosure timelines, and dozens of informative articles on loan modifications and foreclosure. Stop by to check out our growing library of free financial kits. We currently have bankruptcy kits, credit repair, mortgage forms, and loan modification with more on their way!FreeDIYkits “Helping Homeowners Help Themselves”

Article Source:http://www.articlesbase.com/mortgage-articles/your-guide-to-understanding-predatory-lending-laws-how-to-report-mortgage-fraud-1615573.html

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While her children were growing up Mary often thought about starting a small business. Once her kids were in high school and more independent she decided to reach for her dream. After making a business plan she realized that she needed twenty thousand dollars to fund her business. Since she didn’t have access to that kind of cash she decided to take the plunge and get a loan. 

Her collateral was her home, which she had bought when the kids were small and had built up equity. According to her mortgage documents she had well over twenty thousand dollars available for a home equity loan. A visit to her local bank gave her the information she needed to make the right decision.

Second Mortgage or Home Equity Line of Credit?

Mary learned that many homeowners confuse the terms “home equity loan,” “home equity line of credit (HELOC),” and “second mortgage.” All three are loans that use her home as collateral, but there are differences. 

1. A home equity loan is any loan secured with the home as collateral. A home equity loan can be taken out on a home that is owned free and clear. The borrower receives a lump sum payout. 

2. A home equity line of credit (HELOC) is the same as a home equity loan, except that funds can be drawn over a period of time against a fixed credit limit. The borrower only uses what is needed, and only repays what was borrowed, and can continue to withdraw and repay money over an established period of time. 

3. A second mortgage is a specialized form of home equity loan that is taken out in addition to a first mortgage, usually at the same time that the first mortgage is established, and results in a lump-sum payment to the borrower. Second mortgages are usually 15- to 30-year loans with either a fixed or variable interest rate. Unlike mortgage refinancing, the second mortgage does not replace the first mortgage.  

A HELOC is like a credit card that Mary can access when she needs to. Like credit cards, interest is charged, and the credit limit is based on her credit rating. To determine the amount of her HELOC, Mary’s lender examined the appraised value of her home and started their calculations at 75 percent of that value. They then subtracted the outstanding balance owed on the mortgage. 

Mary had good credit, and her home was appraised at $300,000. Her lender determined the 75 percent base level of $225,000. Mary had paid off $75,000 of her original $250,000 mortgage, so her lender then deducted the remaining $175,000 from the base level of $225,000, which gave her a maximum of $50,000 available on a HELOC. 

Mary and her lender agreed on a HELOC of $30,000. The draw period—the amount of time that she has to use the line of credit—was set at ten years. After the close of the draw period Mary has ten years to repay any outstanding balance. Her variable interest rate was tied to the prime rate. There was no loan fee. 

A good deal? Only if Mary is serious about her business and makes a profit. What should she be concerned about? 

• The collateral for her business loan is her home. This is not without risk. If her business is successful, Mary will have no trouble paying off her home equity loan. But if her small business runs into trouble—as many do—Mary will have to find some other source of income to pay the balance on her HELOC. 

• The interest rate is variable. If it goes up, this could stress her business plan and force her to raise her profit targets. 

The advantages to a HELOC? Mary can access the cash available to her only when she needs it. If business goes well then she’ll need less loan money and will be able to repay it faster. Plus, with a HELOC she has access to cash anytime, just as if she had a credit card. 

Is a home equity line of credit the right choice for every small business owner? There are advantages and risks, and anyone considering a HELOC should consult a financial professional.

ConsumerFinanceReport.com features an extensive article library covering a variety of personal finance issues and topics, including articles such as Using a Home Equity Loan to Fund a Business, and sections to help consumers pay off debt.

Article Source:http://www.articlesbase.com/mortgage-articles/using-a-home-equity-loan-to-fund-a-business-1595115.html

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Getting a loan if your credit rating is poor is not a simple task. However, bad credit home refinancing options promises that the process will be easy and tailor made to suit your financial situation. Before finalizing on the lender, however, you need to make sure that you conduct your research well.  Planning it wise will only ensure that you are teaming up with the right lender who has your interests at hand and will help you with your mortgage.

Research

Putting in some time to research for the right mortgage refinance rates will help you in the long run. The best it to get familiar with the “Making Home Affordable Programs” since they are government recognized and are aimed at helping you. Check several online sites, send them emails asking them for details and then prioritize. Although you are not applying for the loan, you are just checking to know which one suit you best.

Keep Your Mortgage Documents Handy

Most lenders and banks will require your mortgage documents so that they know your need for a refinancing loan is genuine. Although they can definitely pull up a soft copy of your report anytime they like, it is best you have your documents keep ready, just in case they need to check them. This applies for your second mortgage as well. You will also need to produce a letter that should explain to the financer why you require the refinance. It is best that you put in complete details and do not miss out any of the reasons. Your reason could be that your job has recently cut your salaries and with the interest on your current mortgage, you cannot manage to make ends meet.

With the right bad credit home refinancing plan, you will save your home from any kind of foreclosures due to bad credit rating.

Bad Credit Home Refinancing plans need to be carried out meticulously. For more information, visit http://www.bad-credit-home-mortgage-loan-refinance.com/bad-credit-home-refinancing-a-highly-effective-way-to-achieve-debt-consolidation-and-management.php.

Article Source:http://www.articlesbase.com/mortgage-articles/bad-credit-home-refinancing-what-you-need-to-do-1389387.html

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Getting to finance foreclosure and short sales is a primary reason that most “would be” investors never get on the incredible action. Usually, most properties sell for an average of 70% of their current market value. Most of them go unsold and enter the realm of real estate owned by the lender who issued the original loan. The key reason behind never purchased these properties is the lack of knowledge in the real estate industry on how to secure financing to buy them.

Private lenders are the first instrument for buying these properties at foreclosure sales. There are two methods to secure these funds. The first thing is to leverage a personally owned property with equity in it before the sale and use these funds to finance the deal. It is the simpler of the two methods for the investor. The other one is more complex. The investor must find a hard money or private lender, inform them of their intentions and get them to finance the majority of the purchase. Below, I will provide a tried and actual method of accomplishing this.

•Recognize the property that you to buy at the sale. Ideally, this will be a property that was bought several years ago and has lots of equity remaining in it.

•Inspect the property and look for any sort of harm that will increase your rehab expense.

•Do some work in advance so that the lender knows the property has no encumbrances.

•Make sure to do insurance work in advance so the property can be insured within hours of making investment.

•Have the entire mortgage documents from the lender done in advance with just the loan amount omitted. With this way, after the bidding has taken place, you can quickly go to the lenders place of business, sign the documents, pay for the home insurance, and attain the check to complete the sale at the courthouse.

•Complete you Rehab as soon as possible, refinance into a usual loan, and obtain the rewards of being a triumphant foreclosure investor.

Sell More Short Sales is a leading Northern California loan modification advisory firm dedicated to provide short sale services. If you are looking for short sale services then consult with Sell More Short Sales.

Sell More Short Sales

Article Source:http://www.articlesbase.com/mortgage-articles/northern-california-loan-modification-822128.html

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