In order to avoid the mortgage frauds, and in order to avoid becoming a victim of one such fraud programs, it is wise of you to become aware of the different situations, where you can get scammed. You can get scammed while taking out a mortgage, while trying to buy a home, while trying to sell a home or when trying to get a loan modification done on your mortgage, or if you are trying to refinance your property.
Mortgage scam situations
There are different situations under which you can get scammed, and some of these are:
- Predatory lending – This mainly happens with the senior citizens, or the individuals having low income, or problems with regards to bad credit. The predatory lenders in general, charge exorbitant fees and high interest rates. This can in the long run result in loss of the home.
- Equity skimming – This is the situation in which an investor takes out the mortgage, only through falsification of the credit and the income documents of another buyer. After the closing, that buyer in question signs over the property to the investor, simply through a quit claim deed. Thus, this means that the investor isn’t required to make any form of mortgage payments or pay any rents.
- Foreclosure rescue – The fraudsters target those homeowners who are facing foreclosure. They offer foreclosure prevention services to such homeowners, as they seem to be the soft target, who is desperate to save the home from foreclosure. However, the actual situation is like, rather than helping your through the process of preventing foreclosure, the scammer simply runs away with your money, as thy in general charge upfront fees.
- Property flipping: Property flipping though is a legal procedure, this process can become a scam program too. It happens when there happens any kind of false appraisal, with regards to the property.
Other than the above, some of the common examples put forward by the National Consumers League are the likes of:
- Refinance fraud – This happens when you as the victim is going to sign over the ownership of your house, under the notion that you are signing over the documents so as to obtain a new loan with better terms and conditions.
- Upfront Fee Scam – This is the situation in which the scammer promises that he is going to negotiate with the lender or the bank against an upfront fee, so that you can pay down the mortgage. However, this fraudster actually runs away with your money.
- Lease-back or repurchase scams – A con artist promises to pay down the dues on the mortgage and then lease the house back to the victim. However, there is one condition and this is that the consumer will be required to sign over the deed on the home. The scammer as a result will have the upper hand and thus, get to raise the rent, sell off the house, or get the equity.
So, these are some of the situations in which you can get scammed, while trying to modify the loan, or sell or buy a house, and so on.
Are you planning to obtain home equity loans? If yes, then before you go on with your borrowing plans, you must be sure about what a home equity loan has to offer you.
In a home equity loan, the home of a borrower is used as collateral for the lender. If a borrower fails to payback the loan, then the lender can take charge of the house and sell it to compensate the debt.
You need to check the eligibility criteria before you apply for the loan. Many lenders make it a point, that you must have at least 20% equity in the home. Equity is the difference between the current market value of the possession and the amount still owed on the mortgage. Your lender will even check your previous credit history, your credit score and your income source to check your viability. The better deal will go to the borrower with good credit score. If you lack on that, then start working on your credit report. Your income is also very important, as it suggests that you can afford the loan payments.
The benefits of a home equity loan:
The advantages are numerous. Home equity loan is basically famous because it provides you money when you need it most. Suppose you have urgent work to finish off and need money, then a home equity loan can save you. The interest rates on home equity loans are fixed and don’t fluctuate now and then to increase your discomfort. You can payback your loan through easy monthly payments. The payment period can be stretched from 5 to 30 years, depending on the terms and conditions offered by lender and the amount you owe.
Home equity loans are helpful, but not completely foolproof. You know the benefits and you must be aware of the disadvantages too.
- Difficulty in payment will snatch your asset: If you aren’t stable in your career and doesn’t have steady income source, then it’s advisable for you not to think of home equity loans. You may loose your house if you can’t payback your loan.
- Home value may plummet: It can cause you a great trouble if the value of your property drops. You’ll end up owning more than the value of the house.
- Leasing will not be possible: You won’t be able to lease your house during the term of the loan.
Any type of loan must be dealt with carefully and when it’s home equity loan, you must be doubly cautious. After all, nobody would like to loose his or her house due to some impractical mistakes.
An energy efficient mortgage (EEM) (or "green mortgage")[1|http://en.wikipedia.org/wiki/Energy_efficient_mortgage#cite_note-1] is a loan product that allows borrowers to reduce their utility bill costs by allowing them to finance the cost of incorporating energy-efficient features into a new housing purchase or the refinancing of existing housing. [2|http://en.wikipedia.org/wiki/Energy_efficient_mortgage#cite_note-2]
Borrowers who qualify for an EEM need to complete a home inspection by an energy rater working off qualification standards created by the U.S. Department of Energy. The results of this energy audit can then be used when applying for an EEM.[3|http://en.wikipedia.org/wiki/Energy_efficient_mortgage#cite_note-3]
First introduced in 1980, EEMs are currently sponsored by all mortgage programs insured by the U.S. federal government. To date, the popularity of the product has been somewhat limited: The New York Times estimates less than 1% of all U.S. home loans are EEMs.[4|http://en.wikipedia.org/wiki/Energy_efficient_mortgage#cite_note-4]
Pfeiffer, Nils, and Kaltrina Hoxha. "Kosovo and Climate Change: A Strategic Approach to the Copenhagen Climate Change Conference 2009." Kosovo.birn.eu. Ed. Tom Fuller. BIRN, n.d. Web. 3 Oct. 2012. <https://docs.google.com/a/pr-solutions.net/viewer?a=v&q=cache:aIyNzz9xfHMJ:kosovo.birn.eu.com/attachment/000000997.pdf+&hl=en&pid=bl&srcid=ADGEESibm7gM9ZR1qZorwEFUO5IQgQzZC92H7yN9ipoRzuAaRcftAZDClsdYlu6E095ABXjB3GeyeVFifUfZttW1YeFtEdbXn1mQ1WPF7cFH28N9wU7g-aOoru8O_TzZrrE-aufKQ9ct&sig=AHIEtbSpF8Vd5IlkLsEww0ajHgAQDb1XOg>.
This is a report which was put together by BIRN, and which refers to the environmental issues in Kosovo. It mainly is focused on Kosovo's position on the climate change, and discusses how this is not one of the main priorities of Kosovo's government and people. They discuss many fields where the environment is being significantly hurt, including the field of forests-deforestation, providing potential solutions as to how to prevent it from happening