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Predatory Lending, What is it?
The
following information, portions of which were excerpted from a Brochure
published by the Attorneys Title Guaranty Fund, Inc., may well be a partial
cause of some of the issues which created the mortgage crisis we find in the
Real Estate industry today.
Predatory lending describes a lending practice wherein the deceptive promise
of low interest rates, combined with hidden fees and other unscrupulous acts,
are employed by lenders to attract borrowers without regard for their ability
to repay the loan. The ultimate consequence is that some of the victims are
forced into foreclosure.
Predatory lenders usually target those who, because of poor credit history,
or limited income, believe they can not afford a traditional mortgage. While
the elderly and low- income borrowers are the typical targets, no one is
immune to predatory lending practices.
Homeowners seeking to refinance or to obtain a home equity loan to pay bills
or make home improvements are especially vulnerable.
A typical victim was an elderly woman in Washington D.C., whose mortgage
company flipped her loan repeatedly, charging her more than $30,000 in fees
over several years. The company refinanced her loan five times in five years,
charging her lender fees totaling more than 10 percent of the total loan
balance. The woman almost lost her home that she had lived in for more than
35 years.
While loan flipping, or selling on the secondary market, can be a legitimate
practice, the woman in this scenario was taken advantage of by an
unscrupulous lender. The vast majority of the lenders out there are
very reliable and honest, be aware of the “If it sounds to good to be true,
It likely is”. Much lower interest rates than the market is a clue to
potential questionable practices. The local newspapers often publish the
interest rates offered by local lenders in their weekend issues, generally in
the Real Estate section.
Consumer protection organizations and the media are attempting to educate the
public about the problem of predatory lending and Congress is now considering
legislation. Many states have passed laws that attempt to restrict predatory
lending by imposing heavy penalties on those who engage in the practice.
While the problem persists, there are ways to avoid these scams and some of
those ways will be addressed in a future “Title Tip”
Any questions can be directed to
Benchmark Title at 618-239-3750. Please feel free to call or
email:
Serving you from three convenient locations:
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Main Office:
1124 Hartman Lane
Shiloh, IL 62221
Ph: 618-239-3750
Escrow Fax: 618-239-3707
Title Fax: 618-239-3757
Fax Orders: 618-310-1589
President: John Howe
www.benchmarktitle.net
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318 North Main St.
Columbia, IL 62236
Ph: 618-281-9700
Fax: 618-281-9705
Manager: Randi
Schur
4215 S. State Rte 159
Glen Carbon, IL 62034
Ph: 618-288-1695
Fax: 618-288-1852
Manager: Sara Sowell
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Dates to Remember
November 3rd - Home Builders Association of Greater
Southwestern Illinois (HBA) Annual Charity Auction
At The Falls Convention Center
November 8th - Realtors Listing Exchange will be held
from 11:30 a.m. to 1 p.m. at Rusty's in Edwardsville. Please contact Bethany
Bond for details.
November 9th - GGAR "Tools of the
Trade Program"
8:30 a.m. at Hampton Inn, Glen Carbon
November 12th - Officed Closed for Veteran's Day
November 14th - HBA Sales and Marketing
Concil Meeting
8:00 a.m. at Four Points Sheraton, Fairview Heights
November 15th - Realtors Listing Exchange will be
held from 11:30 a.m. to 1 p.m. at Joe Boccardi's in Columbia. Please
contact Bethany
Bond for details.
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Visit SureClose.com for more
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Tolan, our SureClose Specialist, at 618-239-3750 for your sign-on so you
can start saving yourself time and money today. We'll even give you and your
clients a free CD at closing containing copies of their closing documents.
Give me my policy!
Did you know that
lenders and home buyers now receive their title policies at the closing
table? Contact Michelle
Null, VP Escrow Operations, to learn more about this exciting new
program.
Ready to refi?
Lenders and
homeowners will want to hear about our fantastically low new refinance rates.
Contact us today for a quote!
Why wait?
You can place your
next title order now by clicking here.
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