When your credit score is low it is not easy to get a good home loan, with a reputable financial organization. In fact most banks may not consider giving you a home loan if your score is 620 or lower because you would be considered a high risk. Because of this, you may be the perfect targeted to loan predators, people who prey on others who have credit problems. These people are savvy marketers and sales people who will do almost anything to get your business. But don’t be fooled; educate yourself. Here are some tell-tale signs to let you know if you are being prey to loan predators.
1. Excessive and cheap advertising. Flyers come to mind here. Now, I am not saying that reputable and legitimate businesses never use flyers (we do!), but I do want you to be cautious of the special deals or offers expressed on these marketing ploys. If a deal sounds too good to be true, chances are it is a scam. Go online and look for reviews and background information. Bottom line, do your research.
2. Telemarketers. Another tactic that not only annoys you, but us as well. Real businesses who value YOU will not try to pressure over the phone. Be especially wary of fast and smooth talkers.
3. Pressure tactics. Any person who goes not give you time to think things over, but rather tries to pressure you to sign on the spot is likely a fraud. Taking out a home loan is a big decision that must not be taken lightly.
4. Lender encourages bad behavior. We’ve heard instances where loan predators suggest to people that they lie on their home loan application. First of all, it’s against the law to defraud a lender. Secondly, it will end up working against you in the long run for this and future loans.
5. Giving loans to anyone. Finally, if a lender tells you your bad credit is not a problem then it is a sign he or she is a fraud. Don't believe them when they say the loan will fix your financial problems- That's a lie, the only thing that fixes your finances is not to spend money out and then try and pay back what you owe.
Go with your Gut. If it's telling you something doesn't feel right then 9 times of 10 you are right. Always check the credibility of the supposed lender against public records or look up the company they are supposedly with if it exists at all. If it is a legit company; call and ask if the person in question is one of their lenders and if what they told you is their policy. If you still do not feel secure don't do it. It's your life and you are the only one who can safe guard yourself against loan predators.
Have you been a victim of home loan predator or have other tips to look out for, share with me in the comments below.