Hey, this is Casey Lown with Strategic Mortgage Solutions. I’ve been having some conversations with some clients and other professional affiliates, and there seem to be some predatory lending activities going on, particularly with out-of-state banks and retail mortgage lending companies that are also out of state. So I thought I’d just put this quick PSA video together to kind of share with you what are some telltale lender red flags to be aware of.
Number One Lender Red Flag
If you get a call from a lender that was unsolicited, so to speak, you didn’t reach out to them. They directly called you without you asking for that call, that is a red flag to me. Right now, there are many desperate lenders out there that are buying what we call trigger leads.
A trigger lead is when a credit report company has sold your contact information after you’ve had your credit pulled by a mortgage lender. They sell that information to banks and large mortgage corporations. And oftentimes these companies buy those leads because they don’t generate enough repeat business or referral business. And that might be because of the way that they operate, they can’t get that kind of business.
Another Red Flag
Talking to that lender where they’re not wanting to give you something in writing without you applying for a mortgage first. Now, it seems strange to me because, in the last 20 years that I’ve been doing mortgages, I don’t like to actually ask somebody to fill out an application and share all their personal information before I know I have a program or a mortgage that would be affordable and makes sense for them.
Usually, all I need to do is to ask my client; “What kind of purchase price are you looking at if you’re thinking about buying a home? What do you think would be an affordable payment? How much money can you put down? What’s your credit score? Tell me a little bit about your work situation. Do you work for somebody? Is your income steady?”
With a little bit of that information, I can generate loan illustrations that can exemplify what an interest rate might be for that prospective buyer, and what the cost might be. Other lenders can do the same thing. You shouldn’t need to have to fill out an application to be able to get an idea of what they can offer you.
I just wanted to throw that out there really quick. If you ever have any questions or need a little help, we’re always willing to sit down and talk for free with prospective buyers and those that are thinking about refinancing the home. Just give us a call.