| With the recent upheaval in the mortgage lenders | | | | susceptible to these types of loan practices because |
| market the instances of predatory lending practices | | | | they are considered a high risk borrower. Poor credit |
| have decreased. These lenders used high pressure | | | | means the prospective homeowner will not be offered |
| sales tactics to induce manufactured home buyers into | | | | the best loan terms with the lowest rates. Instead they |
| home loans with high interest rates and junk fees | | | | will qualify for what are called sub-prime loans which |
| tacked on. With that said it still is in the home buyer's | | | | need to be approached with caution. |
| best interest to be aware of these types of lenders | | | | Sub-prime loans have the following characteristics; high |
| and take the proper steps to protect themselves. | | | | interest rates and fees with monthly payments that |
| The hard part can be spotting less then honest home | | | | may only cover only the interest owed and does not |
| loan lenders. The easiest way is to get multiple quotes | | | | reduce the principal balance. They may also have |
| from several lenders and then compare the interest | | | | adjustable interest rates that change at designated |
| rates, terms, and fine print included within the quotes. | | | | times resulting in an increase in the monthly payment. |
| Even borrowers with good credit need to protect | | | | Many sub-primes also have pre-payment penalties |
| themselves from these predatory practices. | | | | which prevent the homeowner from paying off the |
| Here are some of the more well known predatory | | | | loan early. And lastly a balloon payment due once the |
| lending practices: Predatory lenders will keep | | | | loans term is up. |
| homeowner's unaware that they may qualify for lower | | | | It is best to avoid any loan that has these types of |
| interest rates. They also add unnecessary costs, | | | | terms in the paper work. |
| referred to as "junk fees", to their loans. They are also | | | | The best way to avoid possible problems is by getting |
| more active in getting their customers to refinance | | | | more then one quote from multiple sources including |
| repeatedly in order to collect more loan fees. | | | | local banks, credit unions, or mortgage brokers who |
| Homeowner's can protect themselves by learning how | | | | have a good history of brokering loans. Any good |
| to shop for good loans that protect their home | | | | lender will offer a Truth in Lending Disclosure which |
| investment. | | | | states the basic terms and conditions of the loan they |
| The first thing the prospective manufactured home | | | | are offering the borrower. This form should also |
| buyer needs to do is obtain a copy of their credit | | | | include the interest rate and monthly payments which |
| report and FICO score. All three major credit reporting | | | | should not change at closing. |
| services are required by law to provide consumers | | | | By getting multiple quotes from manufactured home |
| one free report per calendar year. The better the | | | | loan lenders the homeowner can compare terms and |
| credit rating the better the loan terms will be. | | | | weed out those lenders that may be less then they |
| If the borrower has bad credit he or she is more | | | | seem. |