Tag Archive | “predatory lending”

Mortgage Fraud

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The Mortgage Fraud defines as when you dough or try to dough your Lender in any way that is   called Mortgage Fraud. This could be done either by giving fake documents about property or obtain larger loan than the value of property. Misrepresentation of contract deed is also came in Mortgage fraud shadow. The fraud can be revealed at any time, before contract or during the deed term. If the lender subsequently discovers any part of your loan application is false, not only can it demand immediate full payment of your loan, but you could pay heavy fines.

Mortgage Fraud

Different Kinds of Fraud

There are two basic kinds of mortgage fraud; one is for property and other is for profit.

  • In the first case, buyers lie on their applications to obtain a loan they might not otherwise have qualified for. By high fake income, for instance, they might manage to buy a more expensive house. By using cash back for a down payment, they may seem like buyers worthy of a lower interest rate.
  • Fraud for profit is more complex and more criminal. It normally involves a number of professionals who together conspire to inflate the price of a home.

There are also many other types of fraud are:

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Mortgage Broker

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A Mortgage Broker is a person who helps consumers or businesses to sell their mortgage products acting as a middle –man. In beginning, Lenders sold their properties in open market with great difficulties but after some time, The role of Mortgage Broker was introduced. and it became popular as the need arose.

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The Mortgage Broker simplify the problems in selling the mortgage products for lenders. Another task is done by the Mortgage Broker is to make compliance with mortgage laws and regulations.

Jobs of Mortgage Broker

A Mortgage Broker has different jobs to do which changes with rules & regulations of the state. Broker gives advice to the borrowers when contacted. and Broker is legally liable if advice goes wrong. Fees will be charged.

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Payday Loan Usury Laws: Revolving Cycle of Debt

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More than five million American families pay checks to payday lenders every year. A payday loan can be considered as an advance payment of your upcoming pay that is given to you for a certain fee. The amount borrowed can range from $100 to $1000, for a high interest fee ranging up to 300% or even more.

In some states, it is easier to find a payday lender than a fast food chain. Usury laws, considered to be the first consumer laws are used to protect consumers from predatory lenders, that charge very high interest rates for a short-term payday loan.usury laws

According to the federal Truth in Lending Act (TILA), a payday loan company must disclose the cost of their loans as a fee and as an annual percentage rate (APR). Under the Truth in Lending Act, banks acting as consumer lenders must ensure that accurate disclosures are provided to clients. Usury laws regulate payday loans in 37 states. These regulations specify the maximum interest rate at which loans can be given. Most of the states have usury laws including special usury laws such as small loan acts.

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