Get Info on Refinance Mortage from 14 search engines in 1. Refinance Your Mortage & Reduce Debt. Less Than Perfect Credit OK! Refinance Mortage and Mortage Refinance, common misspellings for Refinance Mortgage. Through a refinance mortage or mortage refinance you can replace California Refinance Mortage, a common misspelling for Calfornia Refinance Mortgage. A California Refinance Mortage is one of our specialties. refinance mortage loan MortgageLoan.com - The Loan Marketplace for home loans, home refinance loans, refinance second mortgage rate calculator refinance mortage Fountain Hills refinance mortage El Mirage refinance mortage San Luis refinance mortage Douglas refinance mortage Queen Creek Refinance Mortage. Refinance Your Mortgage & Save. No Lender Fee. Approval in Minutes. Get Info on Refinance Mortage from 14 search engines in 1. Refinance Mortage LenderSpecializing in Refinancing and Purchaseof your Our website covers all the basics of refinance mortage - from beginning to end. MORTAGE LOAN - Refinance Now & Save Money! CLICK HERE! And california home loan mortgage rate this. Aurora loan mortgage refinance does. Mortgage4house.com provides online resources on mortgage, home loan, refinance mortage, personal finance and other topics. used car refinance car hawaii loan refinance missouri refinance mortgage closing cost refinance refinance in los angeles refinance mortage car loan bad credit mortage bad credit mortgage lenders 31-Jan-2007 06:31 198K Hover 06:31 218K Hover for description refinance mortage 31-Jan-2007 06:31 anytime choose dates sorted by relevance apply home loan refinance texas online buy existing home loan mortgage refinance dear me a refinance mortage is 2nd morgage loan Online mortage loan Motgage rate refinance Morgage application process Quick morgage application Central mortage company Refinance mortage First Time Home Buyer - for mortgage loan, refinance mortage. Resource for first time home buyer. Find mortgage loan or refinance mortage thru our website. Mortgage refinance option goldmedalmortgage52 com, columbus mortgage home equity loan mortgage, refinance mortage new jersey refinance mortgage, Refinance mortage loan. Your birth of date:-. Refinance mortage loan. Mark for my website? Refinance mortage loan. Your comments? hi! nice site:) Refinance mortage loan, July 20th 2006 02:16:10 AM Refinance mortage loan. How did you find this website? Refinance mortage loan First Time Home Buyer - for mortgage loan, refinance mortage Resource for first time home buyer. Find mortgage loan or refinance mortage thru our website. Our portal is dedicated to morgage refinance and many other popular topics, morgage refinancing :: mortage calcualtor :: home mortgage calculater
Post 2:
NATIONAL ASSOCIATION OF CONSUMER ADVOCATES
1730 Rhode Island Ave. NW, Ste. 805
Washington,
DC 20036
THE DOUBLE DIRTY DOZEN PREDATORY MORTGAGE LENDING PRACTICES
-
William Brennan and Patricia Sturdevant
Predatory
and abusive practices by mortgage lenders and brokers, which impose
excessive and unreasonable charges on homeowners, are pervasive and
cause serious harm. The American dream of homeownership is jeopardized
or denied by these pernicious practices. In our view, the most
egregious abusive predatory lending practice is equity skimming or equity
theft, by which lenders purposely acquire large portions of equity in
homes through unreasonably high fees and charges and/ or otherwise structuring
the loan so that the homeowner will be unable to repay, and will default
and be subjected to foreclosure. Equity skimming involves vulnerable,
elderly homeowners being subjected to the loss of homes or the equity
in them through home improvement fraud, flipping, exorbitant fees to
brokers, excessive charges for credit insurance premiums, transactions
requiring payments which exceed what the borrower could reasonably afford
to repay from limited governmental benefits, and other abusive lending
practices
The
typical victims are elderly, unsophisticated people, particularly women,
often of racial minority groups, who have substantial equity in their
homes or homeowners whose dwellings are in need of repair, including
victims of natural disasters such as floods or earthquakes. We have
identified the following indicia of predatory practices, many of which
are merely means to the end of equity theft. These practices are
listed and described below, categorized by abuses associated with the
origination of the loan, servicing of the loan, and collection of the
loan.
I. ORIGINATION OF
THE LOAN.
Home Improvement Scams. Predatory mortgage lenders use local home improvement companies essentially as mortgage brokers to solicit loan business. These companies target homeowners and solicit them to execute home improvement contracts. Sometimes they falsely claim that government subsidies are available to pay for the cost of the home improvements. The company may originate a mortgage loan to finance the home improvements and sell the mortgage to a predatory mortgage lender, or steer the homeowner directly to the predatory lender for financing of the home improvements. The homeowners are often grossly overcharged for the work, which the contractors often perform shoddily and fail to complete as agreed. They sometimes damage the homeowner’s personal property in the process. In other cases, the contractor fails to obtain required permits, thereby making sure that the work is not inspected for compliance with local codes, and that shoddy work need not be corrected.
Mortgage Broker’s Fees and Kickbacks. Predatory mortgage lenders also originate loans through local mortgage brokers who act as “bird dogs”, or finders for the lenders. These brokers represent to the homeowners that they are working for them to help them obtain the best available loan, and the homeowners usually pay a broker’s fee. In fact, the brokers are working for predatory lenders, who pay brokers kickbacks to refer borrowers for loans at higher interest rates than those for which the borrower would otherwise qualify. On loan closing documents, the industry uses euphemisms to describe these referral fees: yield spread premiums and service release fees. Also, unbeknownst to the borrower, her interest rate is increased to cover the fee. The industry calls this bonus upselling or par-plus premium pricing; we call it paying unlawful kickbacks.
Steering to High Rate Lenders. Some banks and mortgage companies steer customers to high rate lenders, even though those customers may have good credit and would be eligible for a conventional loan from that bank or lender. Sometimes the customer is turned or steered away even before completing a loan application. In other cases, the loan application is wrongfully denied and the customer is referred to a high rate lender, who is often an affiliate of the bank or mortgage company. Kickbacks or referral fees are paid as an incentive to steer the customer to a higher rate loan.
Making Unaffordable Loans. Some predatory mortgage lenders purposely structure loans with monthly payments that they know the borrower cannot afford so that when the homeowner is led inexorably to the point of default, she will return to the lender to refinance the loan, and the lender can impose additional points and fees. Other predatory mortgage lenders, called hard lenders, intentionally structure the loans with payments the homeowner cannot afford in order to lead to foreclosure so that they may acquire the house and the valuable equity in the house at a foreclosure sale.
Falsified or Fraudulent Applications. Some lenders knowingly make loans to unsophisticated homeowners who do not have sufficient income to repay the loan. Often, such lenders wish to sell the loan to an investor, which requires that the borrower appear to have sufficient income to repay the loan. Such lenders have the borrowers sign a blank application form, and then insert false information on the form, claiming that the borrower has employment or income that she does not, so it appears that she can make the payments.
Adding Co-signers. This is done to create the false impression that the borrower is able to pay off the loan, even though the lender is well aware that the co-signer has no intention of contributing to the payments. Often, the lender requires the homeowner to transfer half ownership of the house to the co-signer. The homeowner thereby loses half the ownership of the home and is saddled with a loan she cannot afford to repay.
Incapacitated Homeowners. Some predatory lenders make loans to homeowners who are clearly mentally incapacitated. They take advantage of the fact that the homeowner does not understand the nature of the transaction or the papers that she signs. Because of her incapacity, the homeowner does not understand that she has a mortgage loan, does not make the payments, and is subject to foreclosure and subsequent eviction. Forgeries. Some predatory lenders forge loan documents. In an ABC Prime Time Live news segment that aired on April 23, 1997, a former employee of a high cost mortgage lender reported that each of the lender’s branch offices had a “designated forger” whose job it was to forge documents. In such cases, the unwary homeowners are stuck with loans they know nothing about.
High Annual Interest Rates. Because the purpose of engaging in predatory lending is to reap the benefit of high profits, these lenders always charge extremely high interest rates. This drastically increases the cost of borrowing for homeowners, even though the lenders’ risk is minimal or non-existent. Predatory lenders may charge rates of 19 to 25%, or 2 ½ times the rates of 7 to 7.5 percent being charged for conventional mortgages.
High Points. Legitimate lenders charge points to borrowers who wish to buy down the interest rate on the loan. Predatory lenders charge high points, but offer no corresponding reduction in the interest rate. These points are imposed through prepaid finance charges (or points or origination fees), which are usually 5 to 10%, but may be as much as 20%, of the loan. The borrower does not pay these points with cash at closing. Rather, the points are always financed as part of the loan. This increases the amount borrowed, which produces more actual interest to the lender.
Balloon payments. Predatory lenders frequently structure loans so that the borrower’s payments are applied primarily to interest, and at the end of the loan period, the borrower still owes most or all of the principal amount borrowed. The last payment balloons to an amount often equal to 85% or so of the principal. The homeowner cannot afford to pay the balloon payment, and either loses the home through foreclosure or is forced to refinance with the same or another lender for an additional term at additional cost.
Negative Amortization. This involves structuring the loan so that interest is not amortized over the term. Instead, the monthly payment is insufficient to pay off accrued interest and the principal balance therefore increases each month. At the end of the loan term, the borrower may owe more than the amount originally borrowed. With negative amortization, there will almost always be a balloon payment at the end of the loan.
Credit Insurance – Insurance Packing. Predatory mortgage lenders market and sell credit insurance as part of their loans, often without the knowledge or consent of the borrower. Typical insurance products sold in connection with loans include credit life, credit disability, credit property, and involuntary unemployment insurance. Lenders frequently charge exorbitant premiums, which are not justified based on the extremely low actual loss payouts. Frequently, credit insurance is sold by an insurance company which is either a subsidiary of the lender or which pays the lender substantial commissions. Another way of charging excessive premiums is to over-insure borrowers by providing insurance for the total indebtedness, including principal and interest, rather than merely the principal amount of the loan. In short, credit insurance becomes a profit center for the lender and provides little or no benefit to the borrower.
Padding Closing Costs. In this scheme, certain costs are increased above their market value as a way of charging higher interest rates. Examples include charging document preparation fees of $350 or credit report fees of $150, which are many times the actual cost.
Inflated Appraisal Costs. In most mortgage loan transactions, the lender requires an appraisal. Most appraisals include a detailed report of the condition of the house, both interior and exterior, and prices of comparable homes in the area. Others are “drive-by” appraisals, done by someone simply looking at the outside of the house. The former naturally costs more than the latter. However, in some cases, borrowers are charged for a detailed appraisal, when only a drive-by appraisal was done.
Padded Recording Fees. Mortgage transactions usually require that documents be recorded at the local courthouse, and state or local laws set the fees for recording the documents. Predatory mortgage lenders often charge the borrowers a recording fee in excess of the actual amount established by law.
Bogus Broker Fees. In some cases, predatory lenders charge borrowers broker fees when the borrower never met or knew of the broker. This is another way such lenders increase the cost of the loan for their own benefit.
Unbundling. This is another way of padding costs by breaking out and itemizing charges that are duplicative or should be included under other charges. An example is charging a loan origination fee, which should cover all costs of initiating the loan, but then imposing separate, additional charges for underwriting and loan preparation.
Excessive Prepayment Penalties. Predatory lenders often impose exorbitant prepayment penalties. This is done in an effort to lock the borrower into the predatory loan for as long as possible by making it difficult for her to refinance the mortgage or sell the home. This practice provides back end interest for the lender if the borrower does prepay the loan.
Mandatory Arbitration Clauses. By inserting pre-dispute, mandatory, binding arbitration clauses in contractual documents, some lenders attempt to obtain an unfair advantage by relegating their borrowers to a forum perceived to be more favorable to the lender. This perception exists because discovery is not a matter of right, but is within the discretion of the arbitrator, the proceedings are private, arbitrators need not give reasons for their decisions or follow the law, a decision in any one case will have no precedential value, judicial review is extremely limited, and injunctive relief and punitive damages are not available.
Flipping. Flipping involves successive, repeated refinancing of the loan by rolling the balance of the existing loan into a new loan instead of making a separate, new loan for the new amount. Flipping always results in higher costs to the borrower. Because the existing balance of one loan is rolled into a new loan, the term of repayment is repeatedly extended through each refinancing. This results in more interest being paid than if the borrower had been allowed to pay off each loan separately. A powerful example of the exorbitant costs of flipping is the case of Bennett Roberts, who had eleven loans from a high cost mortgage lender within a period of four years. See Wall Street Journal, April 23,1997. Mr. Roberts was charged in excess of $29,000 in fees and charges, including 10 points on every financing, plus interest, to borrow less than $26,000.
Spurious Open End Mortgages. In order to avoid making required disclosures to borrowers under the Truth in Lending Act, many lenders are making “open-end” mortgage loans. Although the loans are called “open end” loans, in fact they are not. Instead of creating a line of credit from which the borrower may withdraw cash when needed, the lender advances the full amount of the loan to the borrower at the outset. The loans are non-amortizing, meaning that the payments are interest only so that the balance is never reduced.
Paying Off Low Interest Mortgages. A predatory lender usually insists that its mortgage loan pay off the borrower’s existing low cost, purchase money mortgage. The lender is able to increase the amount of the new mortgage loan by paying off the current mortgage and the homeowner is stuck with a high interest rate mortgage and a principal amount that is much higher than necessary.
Shifting Unsecured Debt Into Mortgages. Mortgage lenders badger homeowners with advertisements and solicitations that tout the “benefits” of consolidating bills into a mortgage loan. The lender fails to inform the borrower that consolidating unsecured debt into a mortgage loan secured by the home is a bad idea. Paying off the unsecured debt, which necessarily increases closing costs, since they are calculated on a percentage basis, increases the loan balance. Moreover, this practice increases the monthly payments, and exacerbates the risk that the homeowner will lose the home.
Making Loans In Excess of 100% Loan to Value (LTV). Some lenders are making loans to homeowners in amounts that exceed the fair market value of the home. This makes it very difficult for the homeowner to refinance the mortgage or to sell the house to pay off the loan, thereby locking the homeowner into a high cost loan. Normally, if a homeowner goes into default and the lender forecloses on a loan, the foreclosure sale generates enough money to pay off the mortgage loan and the borrower is not subject to a deficiency claim. However, where the loan is 125% LTV, a foreclosure sale may not generate enough to pay off the loan, and the lender may pursue the borrower for the deficiency.
II. SERVICING OF THE
LOAN.
Daily Interest When Payments Are Made After Due Date. Most mortgage loans have grace periods, during which a borrower may make the monthly payment after the due date without incurring a late charge. The late charge often is assessed as a small percentage of the late payment. However, many lenders also charge daily interest based on the outstanding principal balance. While it may be proper for a lender to charge daily interest when the loan so provides, it is deceptive for a lender to charge a late fee as well as daily interest when a borrower pays before the grace period expires.
III. COLLECTION
OF THE LOAN.
High Prepayment Penalties. See description above. When a borrower is in default and must pay the full balance due, predatory lenders will often include the prepayment penalty in the calculation of the balance due.
Flipping. See description above. When a borrower is in default, predatory mortgage lenders often use this as an opportunity to flip the homeowner into a new loan, thereby incurring additional high costs and fees.
Foreclosure Abuses. These include persuading borrowers to sign deeds in lieu of foreclosure, giving up all rights to protections afforded under the foreclosure statute, sales of the home at below market value, sales without the opportunity to cure the default, and inadequate notice which is either not sent or backdated. We have even seen cases of “whispered foreclosures”, in which persons conducting foreclosure sales on courthouse steps have ducked around the corner to avoid bidders so that the lender was assured he would not be out-bid. Finally, foreclosure deeds have been filed in courthouse deed records without a public foreclosure sale.
refinancemortage
These links are my listings of favorite sites about refinance mortage. Everyone who has visited my blog should visit the first site, it really has some good information about refinance mortage
|
Our portal is dedicated to refinance mortage and many other popular topics, including refinance mortage. We are always ready to serve you the best refinance mortage results and resources. As you are reading this, please be advised that refinance mortage isn't always found on the internet, but we are doing everything for you to get refinance mortage. We have been expiriencing problems with refinance mortage resources, but today refinance mortage is one of our most popular searches. Yesterday refinance mortage was searched many times on the internet, but only few people received quality refinance mortage links. We write articles on this topic: "refinance mortage", and we know we are always ahead of everybody who's dealing with refinance mortage. All refinance mortage articles are written by professional specialist who study the refinance mortage topic and know, what they are writing about. If you think, that a story of refinance mortage isn't written properly, or the refinance mortage writer is not right. We will be more than happy to help you reach quality refinance mortage people.