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Protecting the American Dream

Mortgage Information

HOW NOT TO GET GOUGED OR CHEATED ON A LOAN

One of our affiliated groups is the National Mortgage Complaint Center. As a result, we inspect more mortgage transactions than any other group or organization in the nation. Of the current 76+ million US homeowners, we estimate that 90% were over-charged or gouged when “getting” their mortgage product. If you would like to learn more about of our efforts, please fvisit our web site at www.NationalMortgageComplaintCenter.com. The National Mortgage Complaint Center is the most quoted source on the topic of predatory mortgage lending practices in the nation. Our Mortgage Inspection Service is for all homeowners.

In order to assist you through the mortgage maze, we have developed a Top 5 Do’s and Don’ts list:

Do’s

1. Check out the mortgage lender you are about to do business with. Check with the local Better Business Bureau and check the rip-off report on line for any negative reports or postings about the lender.

2. Have the mortgage lender give you a quote to include interest rate and fees associated with the mortgage, before running your credit report. This will allow you to get a reasonable idea of interest rates and fees before actually making formal application. Borrower's should be honest with the lender about what they think their credit is. You should not allow the lender to obtain their credit report and should not pay any up-front fees for the quotes.

3. Once you make formal application for a mortgage (using the Federal 10-03 Application Form), inform the lender that they are required by Federal Law to provide a Truth in Lending Statement and a Good Faith Estimate within three business days of making application for the mortgage.

4. Once you get the Good Faith Estimate and Truth in Lending Statement, have the lender put in writing if they are getting a kick-back for increasing the homeowners interest rate over the best interest available also known as a "Yield Spread Premium". According to Thomas Martin "yield spread premiums are the number one source of over-charges in the mortgage industry and consumers need to understand that if the lender gets a yield spread kick-back, the borrower/consumer will end up with a higher monthly mortgage payment". The lender should also confirm that there will not be a pre-payment penalty associated with the mortgage. The homeowner should then require the lender to put these two items in writing via a formal letter or email. If the lender is unwilling to make these two disclosures, Thomas Martin strongly suggests the borrower "find another mortgage lender".

5. Any one about to refinance or finance a home mortgage should have the National Mortgage Complaint Center review and inspect the mortgage documents before the closing of the mortgage transaction. This mortgage document review and inspection service includes a narrative report that details possible over charges and possible unjustifiable fees or interest rates. If any consumer wants the name of an honest mortgage lender doing business in their state or wants a mortgage document review, feel free to call 866-714-6466.

Don'ts:

1. Use a reputable local or reputable national mortgage firm. Do not use any firm associated with a slick TV ad that says something to the effect, "let 3000 mortgage loan officers beat each other to death for your business". According to Martin, President of the National Mortgage Complaint Center, "these middlemen frequently get huge fees for sending the borrower to the most expensive lenders, with the net result being, you end up paying more money".

2. Do not respond to internet mortgage companies or internet mortgage solicitations. According to Martin, "I see nothing but trouble in dealing with anyone who you cannot see or you cannot check out". Martin says; " some of the worst mortgage deals I have ever seen came from the internet or via internet solicitations".

3. If you are buying a new home from a Regional or National Homebuilder Do Not Use Their Mortgage Product. According to Thomas Martin; " Regional or National Homebuilders gouge and over-charge millions of unsuspecting US homebuyers every year by offering phoney bonuses or other less than honest gimmicks to keep the mortgage transaction in-house". Martin explained; "most home builders offering mortgage products are in fact mortgage bankers, and as such not required to discolse to the consumer that they are in most cases getting huge kick-backs for increasing the interest rate of the borrower over the best rates available (also known as yield spread premiums).

4. You should not allow yourself to be pressured or forced to close before they completely understand the mortgage, its fees and the specifics of their proposed mortgage.

5. Martin advises all consumers to stay away from any or all mortgage products that have a starting interest rate of 1% to 2%. According to Martin; "these scam mortgage devices could be the un-doing of the entire mortgage market because most consumers do not understand that the rate will only stay at 1% or 2% for a month or two before the interest rate and monthly mortgage payment start going up". "If you are on a fixed income and or barely qualify for a product like this; do not go through with the transaction because in a short time they may not be able to make their monthly mortgage payments". Martin also warned about negative amatorized mortgage products because;" why not just pay rent, because thats all you are doing with this mortgage product".

Americas Watchdog's National Mortgage Complaint Center accurately predicted the current US real estate disaster in the June 2005 edition of Money Magazine.

Here is a List of National Mortgage Lenders
we can recommend for being fair and honest.
Honest Mortgage Lenders

HOMEOWNERS
CONSUMER CENTER

Protecting the American Dream