Mortgage Fraud Education
 

Education is Key to Preventing Mortgage Fraud

 Predatory lending practices baffle borrowers with slick presentations, vague answers, pressure tactics, and promises of easy money. The elderly, those with poor credit, and minorities are often the targets.

Not all lenders are bad lenders, but how can you tell the bad from the good? How can you avoid predatory lending practices?

The Indiana Mortgage Bankers Association can help. IMBA is committed to helping stop mortgage fraud and predatory lending practices by educating consumers through free educational programs. For example, the Greater Indianapolis chapter (GIMBA) is offering free presentations to neighborhood groups, organizations, businesses, and colleges to give people the tools to stop predatory lending practices.

Members of the Indiana Mortgage Bankers Association who are active in mortgage banking will give the presentations. The presenter will detail proper lending practices, explain key terms, and offer specific suggestions that the consumer can use when shopping for a mortgage loan. The free educational presentation includes a video that illustrates some common predatory lending practices and, more importantly, how consumers can practice good defense against these tactics. Spanish language presentations are available in the Indianapolis area.

To schedule a presentation, call 317-773-7344 or mortgagefraudeduc@indianamba.org. Don’t be a victim of predatory lending!

IMBA’s best educational advice for borrowers: first, ask questions and second, compare offers.

A few key steps before you sign on the dotted line:

Shop around

Don’t be satisfied with the first offer you get, particularly if the lending institution contacted you first. Get a second and even third offer so you have a basis for comparison. And if it sounds too good to be true, it probably is.

Ask questions

Keep focused on the task at hand: getting a loan you can afford, with terms that are within your budget. Ask:

• How much is the monthly payment?

• Does it include taxes and insurance?

• How many payments will I have to make?

• Are the payments the same for the term of the loan?

• Will my loan be fully repaid at the end of my payments?

• What fees am I paying? What are they for? How much are they?

• What is the interest rate?

• Is there a penalty if I pay off the loan early?

Answers to these kinds of questions should be easily found in the contract and be thoroughly explained to you by the mortgage lender.

Ask for help

A trusted friend or a lending advisor can help. If you feel uneasy working through this process by yourself, by all means, seek out support.