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How Can I Tell If I Have a Predatory Loan?
Have any of the warning signs below happened to you? If you answer yes to any of them, you may have a predatory mortgage loan.
Aggressive solicitation: A lender contacts you frequently by phone, by mail, by email, or at your home to get you to refinance your home.
Loan payments you can't afford: You were given a loan with payments that you can't afford, but you were promised a refinance later on.
Increased monthly payments: Your monthly payment increased even though you thought you had a fixed-rate mortgage.
Loan documents false. Your lender reported your income higher than it really is on the loan application; your signature is forged; or documents are back-dated.
Unsecured debt added to your mortgage loan. Your new mortgage "paid off" your credit card debt or personal loans by adding it to your mortgage.
High Loan-to-value ratio. Your lender's appraisal shows your home is worth much more than you thought. Or the amount you owe on your mortgage is more than your home is worth.
Changes in loan terms or costs. You noticechanges in the amount of your monthly payments or interest rate from what you agreed to.
High interest rate. Your interest rate is high even though you have good credit.
Balloon payments: Your loan requires you to make a large payment at the end of the loan term.
Negative amortization. Your mortgage loan payments get bigger over time.
Pre-payment penalty. There is a penalty if you pay early, refinance, or sell your home.
Steering to High-Rate Lenders. Your real estate agent suggests that you see a specific mortgage broker and that broker offers you a high interest rate.
Flipping. You have refinanced your loan more than one time in a five-year period.
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