When looking for your mortgage, you have to be careful. It would be nice if you could just trust the banks and lenders, but to be honest, sometimes you cannot. Be careful and always vigilant in dealing with anyone who might have access to your money. Typical mortgage scams are:



1. Equity Stripping

If you are encouraged to lie on your loan application form, watch out. When you are unable to make a payment, the old ?he told me to? excuse is of no use. They will foreclose, take your home, and strip your equity?with the ?helpful? fellow who told you to pad your income in the lead.

2. Loans with Balloon Payments

Watch out for banks offering lower mortgage rates on preexisting mortgages. They might be legitimate, but read the terms carefully. Sometimes they will set up a deal where you only pay the interest each month, leaving the balance of the loan due in a single lump sum.

3. Loan Flipping

In this scheme, you are encouraged to get the equity in your house working for you by refinancing and getting a lump sum of cash. The lender then encourages you to take out ANOTHER loan?and, ideally, another, and another. You are probably getting suckered in on interest rates with these loans. You might also be facing a prepayment penalty on each loan. Worse yet, you are slipping further and further into debt.

4. Home Improvement Loans

In this scheme, a contractor will offer to arrange financing for a home improvement loan, and then push you to sign blank pages or papers you have not been able to read. If you do not sign, the contractor will refuse to finish the work. Well, read it carefullyand never sign anything blank because you might be signing up for a high interest home equity loan. Worse yet, often these contractors disappear without doing any work once you have signed up for the loan.

5. Credit and Insurance Packaging

This basically refers to a lender trying to sell you extra insurance you may not want or need. They will either slip the papers in with other loan papers and hope you fail to notice it, tell you it is all part of the loan (in the hopes you will not realize you are paying extra), or make a fuss about how much extra time it will take if you refuse the purchase. Do not be pressured into buying insurance you do not need.

6. Unfair Mortgage Practices

If you receive letters saying you owe more money than your original mortgage payments were supposed to be, get suspicious, especially if they claim you have made late payments when you have not. Some lenders will do anything to get that extra money, and they expect you to be too ignorant to know what they are up to.

7. Signing Over Your Deed

Some lenders will prey on people facing foreclosure, offering to refinance their mortgage. They ask that the deed be ?temporarily? signed over to them to prevent immediate foreclosure, then promptly seize the property as their own, using it as equity and essentially charging you ?rent.? In other words, it is no longer your home.

For more free information and methods to protect yourself from financial scams, or to learn how to repair a poor credit rating, visit: http://www.repairmycreditshop.com.