Predatory lending:

The lenders, who charge higher interest rates to the borrowers and want to derive their benefits only even by abusing the lending practice, are called predatory lenders. Their main concern is to make huge profit. You may come across such lenders anytime in the mortgage market. So be aware of those Predatory lenders. They target mainly the borrowers who are in debts and are in need of easy cash. They fall easy prey of the predatory lenders.

You be in such a situation that you require immediate cash for your medical bills or you may be in some credit problems and don’t find any lenders who can lend you money. In this situation, you may easily become a prey to the predatory lenders.

How can you recognize a Predatory lender?

1. He will charge you higher interest rates and points.

2. He can change the terms and condition even after the closing.

3. He may not provide all the documents and receipts of your mortgage payments which can ultimately create problems later.

4. There are some lenders who assure you to give a loan so that you can pay off the existing mortgage dues and avoid foreclosure. But after signing the deed to his name, it will not come back to give you the loan amount. This is a perfect case of mortgage fraud.

They will not only charge you higher interest rate but they can even harass you and your family and take your property away. Predatory lenders have played a huge role and are mainly responsible for this nation-wide financial crisis. So I would suggest you to go for only government backed loans and also try to improve your credit report so that you do not need the kind help of the predatory lenders.