Examples of mortgage loan fraud or predatory mortgage lending include:<quoted text> I sell homes and the loans were not illegal. At that time we had very low fixed rat loans and we had adjustable rate loans too. The adjustable rate has a lower first year rate and you know the rat can go up. People often want an adjustable rate to qualify for the loan. It was their choice and no one else. They were not force or tricked in any way
Encouraging applicants to include false information and/or lie about their income, expenses, or cash available for down-payments in order to get a loan, thereby lending much more money than a borrower can afford to repay.
Asking borrowers to leave contract signature lines blank.
Failing to include Good Faith Estimates, Special Information Booklet, Truth in Lending and Hud-1 Settlement statements.
Convincing a borrower to refinance a loan several times, each time increasing monthly payments or amounts owed thereby "stripping" any equity accrued.
Charging fees for excessive cost or loan terms and/or for nonexistent products and services. This can include inserting hidden clauses into contracts in which a borrower will unknowingly promise to pay a broker or lender to find a mortgage whether or not the mortgage is closed.
Aggressively pressuring borrowers to accept higher-risk loans such as balloon loans, interest-only payments and steep pre-payment penalties.
Targeting borrowers to cash-out refinance offers when borrowers are knowingly in need of cash due to medical, unemployment or debt problems.
Brokers selling properties for much more than they are worth using false appraisals.