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How to Avoid Predatory Lending

Predatory lending practices involve unfair and deceptive methods which some lenders use to entice or convince a borrower to agree to terms which are less than favorable, or illegal. Broadly defined by the FDIC as imposing unfair and abusive loan terms on borrowers, the lender or their agents impose unreasonable interest rates, outrageous late fees and presenting the terms of a loan as completely unnegotiable.

The fact is, predatory lending is too common in our society and there are a few things a borrower can do to avoid being a victim of predatory lending practices.

Always make sure that you receive a printed list of fees and a good faith estimate of the costs of closing on the loan before you actually apply for the loan. Get several different offers from different lenders and compare the costs, interest rates and fees associated with the loan.

If your lender or their agent encourages you to be anything less than truthful on your application, find another lender immediately. False statements made on an application for a loan are fraudulent statements, and fraud is a criminal offense.

Always use your own, independent appraiser to appraise the home before purchasing it. Predatory lenders will insist on using their own appraisers, as they will inflate the value of the property in order to allow a larger loan to be made.

Never sign a form that has blank fields. Write "N/A" in those fields no matter what your lender or their agent says.

If you follow all of these steps, you should be able to avoid a predatory loan. If you have any questions, please contact the Orlando law firm of Perez Conrique Law for a free consultation.

Categories: Predatory Lending
Perez Conrique Law - Orlando Foreclosure Attorney
Located at 746 North Magnolia Avenue, Orlando, FL 32803. View Map
Phone: (407) 749-1591 | Local Phone: (407) 545-4400.
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