The David M. Damaré Team, Mortgage Lending Experts, Shares Tips to Avoid Online Mortgage Lending Scams
Raleigh, NC, December 19, 2013 --(PR.com
)-- The David M. Damaré Team, founded in 2003, is dedicated to helping families and businesses avoid online lending scams and secure residential home mortgages that benefit homeowners. In addition to honesty, integrity, and respectability, The David M. Damaré Team's commitment to their clients has always been their first priority.
While the American real estate and mortgage lending industry has experienced a difficult recovery, mortgage expert David M. Damaré joined forces with American Dream Residential- Andy May Group, LLC in 2008, and has seen continued growth in some areas of the country, but also the growth of unethical lending practices.
Currently, the David M. Damaré Team is looking out for residential homeowners who are refinancing or those who are purchasing their first home.
Did you know that many states do not require that mortgage lenders be located in their state? This practice leaves the door open for many other out of state and online lenders to attempt to do business across the country.
Lending over the Internet continues to be unreliable, and in many cases, leads to fraudulent behavior that scams the borrower. Sluggish economy and rising lending rates produce the perfect environment for out of state scams.
These mortgage scammers will tell you what you want to hear, and they make lending deals sound too good to be true. Even if you are skeptical, if a scammer can keep a conversation going, somewhere along the way, you buy into their sweet-talking. Before you know it, you realized that you've been scammed, and it's too late to get your money back.
If you are purchasing a home this year, here's what you need to know:
1. Verbal Quote. Never value a quote that has been given verbally or over the Internet that neglects the steps of pulling your credit, completing a documented application and providing a written good faith estimate and Truth-in-Lending statement. There is no penalty for lying to a customer, who may be shocked to receive an initial verbal approval to find their application rejected later on.
2. Upfront Fees. This is a common tactic that involves collection of an appraisal fee, and/or an application/broker/commitment fee up front, which is illegal for a licensed, loan originator to collect in North Carolina. Since many online lenders are not bound by North Carolina lending laws, they try to collect these fees anyway.
3. Low Bid Appraisals. Out of state lenders also use contract appraisers and title agents who bid on the appraisals and closings. This is one reason why there are so many complaints regarding the home not being appraised properly, incomplete or inaccurate title work, and mishandled closings. Not only do these mismanaged appraisals create havoc on the loan process, but they also squander the character of reputable appraisers with local knowledge and experience, giving the industry as a whole a negative stature.
4. "One and Done." Most out of state, online mortgage lenders are not interested in building a client base. Instead, they are only interested in "one and done," focusing on collecting up front feels from a number of people, without the expectation of doing business with you again or possibly at all.
For an upfront appraisal fee of only $400, only $200 or less of this goes to the appraiser, and a bogus of upfront fee of up to $300-$600 adds up to a minimum of $500 in their pockets without performing any service or closing your loan. Depending on volume, that is a tidy source of income for nothing more than a web presence and a phone conversation with a fast talking salesperson.
5. Refinancing Scams. Even though rates are rising and there is movement away from refinancing, that won't stop scammers from posing as mortgage professionals or title agents to refinance or modify your home mortgage. You could end up signing away your house, transferring ownership of the property to the scammer.
6. Your Mortgage has been "Sold." Many financial institutions buy and sell loans and servicing to and from each other, so there is a good chance that at some point your mortgage and/or associated servicing will be sold to another company. In some cases, nothing changes when that happens, but for some loans, payments are made to the new company. Before making mortgages to a new financial institution, always verify that this change is accurate, or you could be making payments to a bogus company, with your home in default.
David M. Damaré comments, "With over 10 year's experience during the most comprehensive and continually changing lending environment, successful completion of both federal and state loan originator testing, and ongoing continuing education each year, I am confident in advising borrowers on rules and regulations and whether or not a particular transaction is possible."
Here's how you can avoid getting scammed by your mortgage lender:
Be aware of these unethical practices, and cease working with a lender if you see these policies. Awareness and knowledge is the first key to protecting your assets. Purchasing a home can be an overwhelming process, with financial terminology that often seems foreign or complicated.
Ask questions to get the information you need to feel confident about purchasing home, especially if you see additional fees. Use questions found on our website www.davidmdamare.com to interview your appraiser.
Work with a licensed mortgage professional who builds a relationship with their client rather than taking your money. Look for an individual state NMLS license number at www.nmlsconsuleraccess.org. Just as your real estate agent is dedicated to your interests about what kind of home works best for your family, your mortgage professional should be just as invested about giving you their expertise that benefits your family's investments.
If a loan product sounds too good to be true, it is. Do as much research as you can, and don't be sidetracked by inflated offers and the absolute lowest interest rate. Don't be afraid to say no or take as much time as you need to consider loan mortgage options before making a decision.
As rates increase from record lows and mortgage applications wane, more local based lenders and loan originators will exit residential mortgage lending. The David M. Damaré Team supports increased competition between educated, experienced licensed loan originators.
However, as more online lenders will appear, don't be caught in an online mortgage lending scam that squanders your dreams of purchasing a home or refinancing your current home.
David M. Damaré adds, "One reason I became a mortgage lender is because of my background. As a military office and a pilot, honesty and ethical practices are not only imperative but instilled for life and currently ensure quality service for my clients. Unfortunately, in the mortgage business, honesty and ethical practices are for most, a choice. It's important to know who holds themselves to a higher ethical bar, both in our profession as well as in our service to the community and/or country."
The David M. Damaré Team partners with American Dream Residential, founded in 2003, is focused on funding the American Dream for families throughout the country, with its primary focus on the fast growing southeast and Mid-Atlantic States. American Dream Residential, with U.S. Headquarters is Raleigh, North Carolina, is dedicated to offering respectable and fair lending practices.
For more information on mortgage loans, call The David M. Damaré Team at 919-851-0999 or visit The David M. Damaré Team on the web.