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What is predatory lending?

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Real Estate Agent with Re/Max Boone Realty
I received an email last night talking about how Realtors need to help home buyers avoid predatory lending practices. The email talks about mortgage companies who use a bait and switch type of scenario. For example, a loan officer tells you they can get you a loan and what they need from you. They don't lock in the rate or fees. At the last minute, when you arrive at the closing, the home buyer finds out they are paying a higher interest rate than they believed they were getting and are paying higher fees as well. When the lender is called, they are nowhere to be found so the buyer has to take it or leave it. The lender is betting they will take it because they are ready to move into their new home. I work to educate my clients about the loan process and keep in touch with the lender in the hopes things will go smoothly. However, I don't think the Realtors can put a stop to it alone. I have seen banks do this to people but to stop it, we need help.
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Richard Perkins
R PERKINS REALTY - Stockton, CA
Great post and even better info. Always protect your clients thats our job. Good post Thanks
Oct 23, 2007 09:47 AM
April Ferrao
Re/Max Boone Realty - Columbia, MO
That is why you need to have a great relationship with the lender.  And Why you need to have a great handling of what is going on through all steps of the loan, financing period.
Oct 24, 2007 04:10 PM