Mortgage Loans - The Top Predatory Red Flags

The sub prime market for home mortgages is a hot bed of predatory practices. These types of lenders prey on the elderly, borrowers with poor credit who have few options, and less educated and non English speaking customers. They give the entire industry in general and other good sub prime lenders more specifically a bad name.



A" Perfect Storm" of lax oversight, a down market, and hungry investors makes the perfect environment for predatory lending practices. And there are plenty of takers thanks to the aggressive marketing practices of some lenders.



Here are some of the top red flag warning signs for these lenders.



1.MONEY UPFRONT--Definitely a no-no. If someone asks for money upfront RUN don't walk out the door. Know the difference between this and a legitimate application fee.



2.ARM'S--Beware if an Adjustable Rate Mortgage is the only option offered.





3.BALLOON PAYMENT--Balloon's are for small kids not homeowners. They are too risky especially for Sub Prime Borrowers.



4.TOO BIG A LOAN--Be wary of a lender is trying to sell you on a loan that is bigger than you need.



5.HIGH INTEREST RATE--If the rate seems too high like more than 5 points over prime-keep shopping.



6.FREE VACATIONS--If the loan is a good one, you should need no incentive to take it. Only when it is questionable might there be a "vacation" thrown in for you to do the deal.





7. PRESSURE TACTICS--Any kind of pressure is a bad sign. For example to sign papers now, sign blank papers or to falsify an application are all cases where you need to leave and find another lender.



8.ASSET ORIENTED LENDER--If the lender is more interested in the house as an asset than where the money is coming from to pay the mortgage he is more than likely looking for a foreclosure more than making a loan.



These are some of the top red flag warning signs of a predatory loan/lender. There are others to be sure. For sub prime borrowers, the market is rife with predators looking for an easy mark. Don't be their next victim.



For more information on Mortgages and Home Equity click the links below.



Jack Krohn is a leading free lance writer on Home Equity and Mortgage issues with over 35 articles to his credit. He is also the #1 author of Home Security Articles in the country according to Ezine Articles.

President Obamas Stimulus for Fannie Mae and Freddie Mac Mortgages

Homeowners with mortgages from either Fannie Mae or Freddie Mac are eligible to get a mortgage modification from new Government stimulus programs. These programs allow homeowners to take advantage of low interest rates, and save money on their payments, or their home home from being lost. Getting a mortgage modification using this stimulus plan and Fannie Mae or Freddie Mac is easy. The new guidelines for mortgage modification with Fannie Mae or Freddie Mac are very beneficial for millions of homeowners.



Especially these days, many people need help with their home loan, and this plan is designed to help struggling homeowners in all situations. A huge part of this Government program is the fact that all homeowners who pay more than 31% of their monthly income to their home loan, are now able to get a modification into a lower interest rate. This 31% figure also includes taxes, insurance, and other fees. This will be a major reduction for millions of homeowners, and could help save homes from being lost to foreclosure or default.



Even homeowners who owe more than the home is worth, or who have bad credit and other financial problems can easily get help from this program. In fact, this program is designed to benefit those homeowners the most of all. This plan has over $75 billion in funding, and all homeowners with a loan from Fannie Mae or Freddie Mac can benefit from it. Never before has such a widespread plan been enacted which will help so many homeowners. Everyone with a mortgage from Fannie or Freddie is encouraged to contact them and see what help is available, and what the plan will do for them.



Many homeowners have already used this program for themselves, but millions more are eligible to. Take action now.

Time Management for Mortgage Professionals

In this fast-paced industry, everyday seems to be filled with urgent matters that scream "Do me now!" Managing your office like the emergency ward can only lead to mistakes, bad attitudes, and burn out. The master of life habits, Stephen Covey, gave us a dynamic tool, The Time Management Matrix, in his book entitled, "First Things First". In addition to acknowledging the challenges we all face with defining our priorities, Stephen Covey's matrix gives us the life-altering tools we need to put things in the proper perspective.



The Time Management Matrix below contains some specific examples for the mortgage industry to help you and your team gain control of your time.

Quadrant 1-Quadrant of Necessity

These activities need to be done to maintain the business. They are:

• Pressing problems / crisis

• Deadline-driven projects

• Last-minute preparations for scheduled activities

Examples:

1. Expiring rate locks

2. Document signing for compliance

3. Meeting final approval conditions

4. Closing problems

5.



Planning/preparing for appointments, speaking engagements

Quadrant 2 - Quadrant of Quality & Personal Leadership

These activities improve your quality of life. Long term neglect of these areas could cause them to become Quadrant 1 issues. They include:

• Goal setting and project planning

• Preventive maintenance

• Working toward life values

Examples:

1. Analyzing expenses

2. Forecasting your production goals

3. Adopting a healthy lifestyle

4. Taking a class

5. Spending time with family

6. Engaging in recreational activities

7.



Hiring/training staff members

Quadrant 3- Quadrant of Deception

These items disguise themselves as urgent when in reality they are not. They could be:

• Destructive

• A delegated task

• Busy work

• In conflict with your long term goals

Examples:

1. Excessive phone calls from dysfunctional family members during the work day

2. Drop-ins from visitors known and unknown

3. Commercial direct mail and e-mail solicitations

4. Telemarketer calls

5. Team member disagreements or disputes

Quadrant 4-Quadrant of Waste

These items should not be permitted to rule the day.



Eliminate or reschedule as many as possible.

These items are not urgent or important and do not contribute to your success. They could be:

• Trivial

• Mindless

• An escape from reality

Examples:

1. Chatting on the phone or online during the workday

2. Watching mindless TV for hours on end

3. Reading all your junk regular mail and e-mail

4. Engaging in office gossip

5. Busywork

6. Surfing the net without a goal in mind

These activities can be extremely wasteful and typically do not address the concerns or problems at hand.



It is extremely important for your success to identify what you want to accomplish and why. Implement strategies to eliminate or minimize counter-productive Quadrant 3 and 4 issues. Here are a few suggestions:

1. For team members that need constant direction and guidance, prepare a prioritized task list for them before they arrive at the office. Give them a deadline for completion and provide instruction as needed.

2. Relocate your workspace to distance yourself from the self-absorbed office guy or girl who never shuts up.



If you can't relocate, close the door. If you happen to be caught off guard, stand up when they enter as if you were just on your way out of the area.

3. Set the example by planning, organizing, and implementing in accordance with your goals.

4. Just say "no" to frequent interruptions, calls, and requests that get you off course.

5. Hold up a hand to halt (or a finger to delay) the conversation of the Quadrant 3 person who just invaded your space. They will suddenly realize that you were already otherwise engaged before they interrupted.



Hopefully they will retreat or at least wait patiently.

6. For the person who continuously starts the Quadrant 1 fires that you have to put out, have a serious conversation with them to let them know the long term impact of their actions. Relay the information on an individual level and give the "big picture" version.

As you dedicate yourself to managing your time and resources better, you will begin to see the results you've always wanted.

Stephanie Graham is a mortgage professional with more than two decades of experience in both retail and wholesale lending.



Stephanie has excelled in a number of mortgage industry positions including CRA officer,corporate trainer, and consultant. Stephanie is currently a part of the executive team of Complete Mortgage Processing. More tips and techniques for mortgage processing and origination can be found at http: http://www.completemortgageprocessing.com

The Perils Of The Property Ladder: Has Anyone Noticed The Silence?

As you ascend the dizzy heights of property investment, don't lose your head and ignore mortgage research and advice.



There was a time when every conversation was focussed on property and every other TV programme was about property makeovers. Everybody wanted to get into property and those already on the ladder seemed fixated on becoming wealthy overnight. Remember those media-nominated millionaires who bought property for thousands and sold it for a million? How excited we all were, rich - with hardly any effort.



But recently it's been rather quiet. Those who have yet to buy their first home have become sceptical, if not bored by chasing impossibly affordable homes and those who have bought property have become nervous, if not by the commentary that house prices are falling, but by the fact that they have bought property on top of other debts and the realisation that repayments are becoming more difficult.



According to the Department of Trade and Industry, bankruptcies are still on the increase, up almost a third on the previous year.



In the latest debt statistics by Credit Action, UK economist Vicky Redwood from Capital Economics states that the level of personal debt is at breaking point:



"It is unlikely that the numbers have peaked but we estimate that households must be feeling the pain of borrowing too much. People are paying the equivalent of about 20 per cent of their disposable income on interest and debt repayments - the highest since 1990."



In a survey by the Citizens' Advice Bureau (CAB), the three most common reasons for debt problems were quoted as:



" * Sudden change in personal circumstances - resulting typically from job loss, relationship breakdown or illness;

* Low income - the consequences of living for a long time on a low level of income; and

* Over-commitment - in some cases related to money mismanagement.



"



It is the third reason that is often highlighted in the context of mortgage borrowing. In a press release regarding the Chancellor's proposals to introduce cheaper mortgages, Keith Tondeur, Director of Credit Action warned that:



"At first glance the offer of help to first time buyers sounds useful. However this scheme comes at a time when after several years of steep rises the market is cooling. One question that we should be asking is whether this is being done to keep the housing market buoyant so that people feel confident and therefore keep on spending".



"House prices are undoubtedly too high for many people to afford which explains why numbers of first time buyers have been falling, with the average age of a first time buyer rising sharply. This scheme could therefore, if care is not taken, create a false market and lead to first time buyers taking on a large amount of long term debt that they could well struggle to repay."



The seduction of the property market may cause a vicious circle of debt: if people borrow more than they can afford, they may damage their credit record if repayments cannot be met.



An adverse credit record will brand the borrower "sub-prime", and is likely to prompt less favourable credit options later in life. It is true that products such non-standard mortgages, adverse loans and adverse credit cards serve a purpose, but their rates will always be less favourable than standard products.



In addition to self-inflicted debt, it is also possible for your credit record to be manipulated by other parties. In June earlier this year, Callcredit issued a warning to guard against identity fraud when moving house.



"Homeowners who fail to check their credit file before they move and register themselves on the Electoral Roll once they have moved are at risk from:



* Identity fraud - a fraudster could obtain enough financial information about you from your rubbish to run up debts at your old address without your knowledge. People who just cut up cards and don't tell their lender are particularly at risk from this type of fraud.



* Credit refusal - a person's credit history has to add up to the lender when you apply for credit, if you don't appear on the Electoral Roll at your current address it will make it more difficult to get credit.



"



If you're thinking about buying a house, try the following sites for starting your own detective work in finding a good mortgage:



* Make sure your credit record is in good shape:

* * http://www.callcredit.plc.uk/

* * http://www.checkmyfile.com/

* * http://www.experian.co.uk/



* Don't be lazy, shop around for the best mortgage:

* * http://www.moneynet.co.uk/ (compare mortgages)

* * http://www.cml.org.uk/servlet/dycon/zt-cml/cml/live/en/cml/pub_info (superb range of consumer information.



)

* * http://www.moneysavingexpert.com/mortgages (Martin Lewis has some money saving recommendations)



Make sure you keep your finances flexible; ensure you know what you can afford and for how long you can afford it. What was the best mortgage, current account, ISA account five years ago, may not be performing as effectively now.