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You can avoid becoming a
victim by learning how to identify the warning signs. If you encounter any one
of the situations below and your loan broker is not cooperative, contact the appropriate
state agency. 1.
The loan costs at the closing meeting are much higher on the Settlement Statement
than on the Good Faith Estimate, and you are not given good explanation about
it. 2. Any of
the following disclosures are missing in your loan documents:
Good Faith Estimate
Truth in Lending
HUD-1 Settlement Statement 3.
The lender misrepresented that the total amount borrowed, upon which interest
accrues, is the amount financed that appears on the Truth in Lending disclosure
statement when, in fact, that amount does not include the loan origination fees. 4.
The lender misled you about the existence and amount of origination fees, the
interest rate, and the monthly payments of their short-term "teaser rate"
adjustable rate mortages ("ARMs"). 5.
The lender did not have a reasonable basis to substantiate their claims that you
will save money when consolidating debts through their loans. 6.
You were surprised to find that the monthly payments on your mortgage loan were
higher than you anticipated based on the initial disclosures. 7.
You were asked to leave signature lines blank. The lender or broker altered any
information you entered on your loan application. 8.
Your loan amount on the loan you obtained is higher than the value of the home. 9.
If you have a balloon payment loan (one in which after a series of low payments
the entire loan balance is due in a large lump-sum), you will have to obtain another
loan to finance that final lump-sum amount. 10.
You were required to buy credit insurance, insurance that will repay the debt
if you die or become disabled.
If you have a complaint or question about particular lender's actions, you can
contact: - the
State Banking Authority
- the
Council of Better Business Bureau
- the
Federal Trade Commission
- Department
of Housing and Urban Development
State Banking Authority
State
Banking Authorities are responsible for the chartering, regulation, examination
and supervision of state-chartered banks, savings bank and credit unions. The
division also licenses and supervises the activities of small loan companies,
first mortgage companies and second mortgage companies. The following are their
complaint procedures: Counsil
of Better Business Bureaus 4200
Wilson Boulevard, Suite 800
Arlington, VA 22203
(703) 276-0100
www.bbb.org The
Council of Better Buisiness Bureaus is the umbrella organization for the Better
Buseiness Bureau (BBB) system and is supported by 250,000 local business members
nationwide. It is dedicated to fostering fair and honest relationships between
businesses and consumres, instilling consumer confidence and contributing to an
ethical business environment. The
BBB can handle the following complaints: - misleading
advertising
- improper
selling practices
- non-delivery
of goods or services
- misrepresentation
-
guaranteees or warranties not honored
- unsatisfactory
service
- credit
or billing problems
- unfulfilled
contracts
Federal
Trade Commission (FTC) 6th
Street and Pennsylvania Avenue, N.W.
Washington, DC 20580
(202) 326-2222
www.ftc.gov FTC
has enforcement authority over mortgage companies for the following laws:
- Equal Credit Opportunity
Act
- Fair Credit
Reporting Act
- Fair
Debt Collection Practices Act
- Truth
in Lending Act
Although
the FTC has enforcement authority, they do not resolve individual consumer problems.
Filing a complaint helps FTC investigate fraud, which may lead to law
enforcement actions. The FTC enters Internet, telemarketing, identity theft and
other fraud-related complaints into a secure, online database available to hundresds
of civil and criminal law enforcement agencies worldwide. Department
of Housing and Urban Development (HUD) 451
7th Street, S.W.
Washington , DC 20410
(202) 708-1112
www.hud.gov Consumers
can file a complaint using the online form, mail in a written complaint or by
calling direct. HUD handles complaints in several categories:
- Housing Discrimination/Fair
Housing Act
- Real
Estate Settlement Procedures Act
- Bad
Landlord in Federal Housing
- Manufactured
Housing
- Land
Sales
When
my clients are considering refinancing or obtaining a new loan, I always provide
accurate, realistic loan estimates that always come with a detailed cost breakdown.
Feel free to contact me at no obligation, but no matter who you do call, be sure
to avoid the mortgage scams. 
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