One of the best ways of securing a home mortgage loan is by working with a quality lender. The lender should be able to provide you with help in finding the best loan for your situation. The lender should be someone you trust, someone who is working for you and looking out for your best interest. However, while great mortgage lenders are the norm, some need to be avoided at all costs.
The crooked lender is the person who has no interest in helping you but is merely looking out for him or herself. This person does not care if you have to file for bankruptcy or if you lose your home after a few years because you were pushed into the wrong home. When meeting with a lender, be honest about what you need and want and never be afraid to ask questions. Now, if your credit were less than perfect, you would be targeted more.
Bad Faith – Under the Real Estate Settlement Procedures Act, any lender is required to provide you with a good faith estimate, which would outline all of the fees due at closing. This information must be provided within three days once you have applied for the mortgage loan. If the lender does not provide this to you then you should be questioning why.
Exaggerated Low Rates – If the lender promises you low rates that are exaggerated, appearing way out of the ballpark, they probably are. For instance, if you were offered 2% or 3% points below the national average, then beware.
High Rates – The same would be true in the case of exaggerated high rates. IF the rates are higher than the going rate, you should again be questioning the reason why.
High Pressure – If at any time the lender pushes you or tells you the only way to secure a home loan would be with that particular company, you need to run. There are thousands of qualified lenders so if someone says there is just one, you know it is a lie.
Prepayment Penalties – With so many great mortgage loans available today, there is no reason to secure one with prepayment penalties. Therefore, if a lender advises you that the only way you will be approved is with a loan that has these penalties, you know that is not true.