There’s no denying COVID-19 has led to money struggles for homeowners across our state and nation. A recent study conducted by OnePoll in conjunction with the National Association of Realtors revealed more than eight in 10 American homeowners (81%) say the pandemic has caused them unexpected financial distress.
Sadly, some homeowners are taking desperate measures to ensure they can protect their investments. Scamming activity increases during times like these, so homeowners must remain vigilant and be cautious of offers that sound too good to be true.
How can one help to be sure an offer of assistance is legit? Here are some warning signs of scams and unfavorable loan terms:
It sounds too easy
Be wary of offers that declare “guaranteed approval” or “no income verification” regardless of borrower’s current employment, credit history or assets. If it sounds too good to be true, it probably is.
Large future costs
High-risk, adjustable-rate mortgages in which payment rises significantly after the “teaser rate” period is seldom appropriate for families who already have had problems repaying other loans. These loans were a major cause of home foreclosures in the late 2000s.
Barriers to refinancing
Steer clear of high-cost loans with prepayment penalties that make it hard for a borrower to refinance by taking advantage of a low-cost loan.
No down payment loans
These loans might be split into two mortgages, with one having a much higher cost. Homebuyers should be sure they can afford the payments.
Unethical document management
Ethical lenders and brokers will never ask you to sign a blank or predated document. In short, know what you’re signing before you sign it.
If you’re a homeowner who’s struggling or unable to meet your loan obligations, work with housing experts and your lender to find a solution today. Time is of the essence, so don’t wait until you fall behind to seek help. Acting quickly might help you keep your home and the money you’ve already invested in it.
Realtors are in the business of helping people become homeowners, and we want to do everything we can to make sure you can afford to stay in your home and remain cautious of potential scams.
If your current lender isn’t willing or in position to help, you might be able to refinance your mortgage with another lender. Your Realtor might also be able to help you find responsible lenders that offer fair and affordable loans.
Realtors work to keep people in their homes. That’s Who We R.
Greater Chattanooga Realtors is The Voice of Real Estate in Greater Chattanooga. A regional organization with more than 2,400 members, Greater Chattanooga Realtors is one of 300 local boards and associations of Realtors nationwide that comprise the National Association of Realtors. Greater Chattanooga Realtors services Hamilton and Sequatchie counties in southeast Tennessee and Catoosa, Dade and Walker counties in northwest Georgia. For more information, visit www.gcar.net or call 423 698-8001.