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Are you looking for certain inside info on
home equity line credit criteria
Home Equity Loan Beware of equity stripping scam
The market for mortgage refinancing has been brisk during the last few years. The boom in business can be attributed to interest rates that have been at or near historic lows, and to lenders who have more money to lend now that they arent investing in risky tech stocks anymore. Low rates and agreeable lenders are certainly good for consumers who might be interested in refinancing their home or taking out a home equity loan. Those considering such loans should be aware that the booming market for refinancing has led to increased competition among lenders. And when the competition increases, so does the number of lending scams.
These days, lenders are surprisingly aggressive. Its not unheard of to have people knock on your door, asking if you would be interested in refinancing your home. Lenders that are eager to lend you money are great, provided that you are actually interested in borrowing. If you are, then you should be careful Make an effort to thoroughly investigate your lender if you do not have a previous relationship with them.
A scam that is increasingly common in todays market is a lending scheme known as equity stripping. A homeowner applies for a home equity loan, or perhaps applies to refinance their home. A lender then encourages the homeowner to borrow more money than they can afford, and perhaps assists by falsifying some information on the application. The lender does this with hopes that the homeowner will default on the loan. When the homeowner defaults, the lender forecloses on the property, sells the property, and keeps the homes equity as profit.
This is one of many scams that can currently be found in the mortgage industry, and one that can be avoided if potential borrowers will take the time to do a bit of research before signing on the dotted line. Homeowners who are interested in refinancing their home should investigate prospective lenders before doing business with them. Contacting friends who have recently refinanced or the local Better Business Bureau would be a good place to start. Lenders who call you out of the blue or knock on your door are probably best avoided.
About the Author
Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a Website devoted to debt consolidation information and HomeEquityHelp.net, a site devoted to information on home equity loans.
More Useful Resource and Updates on home equity line credit criteria
- Kiwibank Responds To OCR Cut (Scoop.co.nz)
Kiwibank has reacted immediately to the cut in the Official Cash Rate by reducing all home loan rates. The bank is now offering a one-year fixed rate of 6.49% p.a. and a variable rate of 7.45%.
- Bernanke says need to do more to halt foreclosures (Reuters via Yahoo! News)
Federal Reserve Chairman Ben Bernanke on Thursday urged more aggressive action to halt home foreclosures, and said write-downs of principal may need to be part those efforts.
- SBA: Small banks mitigate business-loan downturn in Minnesota (Finance and Commerce)
The last 12 months produced shudders and slowdowns in one credit market after the other, and the U.S. Small Business Administration?s loan programs haven?t been immune.
- Consumer Loan Rates (The Springfield News-Leader)
Springfield financial institutions quoted the following rates Friday for home equity, auto and boat loans. The home equity rate is based on a $10,000 loan or line of credit with applicable points included. Rates are variable unless otherwise noted. Additional fees are not included. The auto loan rate is based on a 48-month contract for a new car. The boat rate is based on a loan for a new boat.
- Proposal could drop mortgage rates to 4.5 percent (San Jose Mercury News)
If Treasury Department approves plan, said one mortgage broker, 'We would have everybody and their brother who had equity in their homes coming to refinance. That would be an amazing influx of loan applications. It would keep things going for a long, long time.' Rates drop to 11-month low Bernanke: More foreclosure help needed Real estate news | Economic crisis news
- Fixed-rate trap snares 43,000 home owners (Sydney Morning Herald)
MORE than 40,000 unlucky people have been caught out in a fixed mortgage rate trap, having taken out their loan at the highest fixed interest rates in a decade, denied any saving from the recent cuts and confronting costly break fees if they decide to refinance.
- Opening the tap on home equity (Austin American-Statesman)
Borrow before credit line is frozen, some suggest. Many homeowners who have taken out home equity lines of credit have learned in recent months that these loans are not as useful as they initially seemed.
- Fed chief urges further steps to halt foreclosures (International Herald Tribune)
Ben Bernanke on Thursday urged more aggressive action to halt home foreclosures, and said write-downs of principal may need to be part those efforts.
- Bernanke urges action to halt foreclosures (Reuters via Yahoo! News)
Federal Reserve Chairman Ben Bernanke on Thursday urged more aggressive steps to halt home foreclosures and said government-funded programs could help strapped homeowners.
- Five Home-buying Myths (Carteret County News-Times)
(ARA) - As first-time homebuyers grow curious about the home-buying process, they often turn to friends and family for advice about purchasing a home. While these sources can provide useful tips and information, they also may perpetuate some common home-buying myths.
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