California Mortgage Lenders

Financing a new mortgage?
Beware of "predatory lenders."

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After almost a decade in the real estate sales profession and dealing with countless lenders I came to the conclusion that the only way my clients would receive the honest high level of service I provided as a realtor was to handle the loan side of the process myself. I thought I knew a lot about loans but really had no idea of the details and nuances of the process before working in the business for the past 10 years.

Predatory lenders typically target what’s known as the nonprime mortgage market, where people with blemished credit records try to borrow money for homes in less desirable neighborhoods, which means that it's often minority groups, such as African-Americans and Latinos, who are the victims of predatory lending practices. .

California Mortgage Lenders and The Center for Responsible Lending describe a number of such practices. Some of them include loan flipping, in which the borrower is forced to refinance a loan, sometimes several times, solely for the purpose of generating new fees for the lending institution. Another common practice is insisting that borrowers also purchase such things as credit life insurance or other products--again, primarily designed to generate more income for the lender.

The bottom line is that there are lending institutions that make a great deal of money by charging extra fees to those borrowers who can least afford them, thereby either depriving those borrowers of the American dream of home ownership or, worse yet, setting them up for eventual foreclosure.

As the real estate market slows down and interest rates creep up, it's more important than ever to become a knowledgeable consumer. Learn the basics of mortgage lending here at California Mortgage Lenders, so you'll know when you're being charged too much for a loan or for things you don't need. Shop around to see what's available, and then make sure you're comfortable with your loan payment, because you'll be paying that amount for many years.