Predatory Lending

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Once You've Selected a Lender, Get the Fees in Writing

A "Good Faith Estimate" of all loan charges. The estimate must be sent within 3 days of applying. Blank copies of the forms you'll sign at closing, when the loan is final. Study them. If you don't understand something, ask for an explanation. Advance copies of the forms you'll sign at closing with the terms filled in. A week or two before closing, contact the lender to find out if there have been any changes in the Good Faith Estimate. By law, you can inspect the settlement statement (also called the HUD-1 or HUD-1A form) one day prior to closing. Study these forms. Write down any questions you want to ask.

Don't Sign if the Lender …

  • Tells you to falsify information on the loan application (for example, suggests that you write down more income than you really have).
  • Pressures you into applying for a loan for more money than you need, or one that has monthly payments larger than you can afford.
  • Promises one set of terms but gives you another with no good reason for the change.
  • Tells you to sign blank forms or forms that aren't completely filled in. If an item is supposed to be blank, draw a line through the space and initial it.
  • Pressures you to sign today. A good deal today should be available tomorrow.

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