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Don’t Become a Victim of Home Equity Loan Scams

Don’t Become a Victim of Home Equity Loan Scams, by Home Equity Loans Editor

There are so many ways that lenders can make a fool out of you and take away your money as well as your home with the different home equity loan scams that they have up their sleeves. Although it is not true for all lenders, it is always best to stay alert and keep an eye out for home equity loan scamers who will trick you into entering loan agreements that you cannot afford. Here are some ways how you can protect yourself from these equity loan scamers:

First, if you do not have enough disposable income to cover a loan payment schedule for a home equity loan, it is best to not sign up for the loan at all. Don’t ever make it seem that you make more money than you actually do just to be able to qualify for the loan. Doing so will only put you deeper in debt than you could ever imagine and you will be regretting it when the time comes when you can no longer make your monthly payments.

NOTE: Excellent Resource : Federal Trade Commission – Borrowers beware.

Second, always read the loan contract before you sign anything. To prevent incurring costs that you never knew about, take a good look at the document and all the terms and stipulations that you have to follow. If you need to, sit down with a representative from the lending company to explain all the fees and costs thoroughly so that you are not left in the dark about any details of the contract you are about to sign. More importantly, remember that this is your loan to pay so you will always make the final decision. Never let someone else influence you into signing the document against your own choice.

Third, if you find out in the final document that you are charged with extra charges of fees and insurance, you shouldn’t sign the document. Make sure you read the whole thing, including the details of the schedule of fees, before you put the pen down on the paper. If you find there are extra charges for insurance that you never agreed to, return the contract and make them redraft it so that it fits your specifications and what you originally agreed to.

Fourth, just because there are lower monthly payments, don’t let this cloud your judgment about signing up for a home equity loan. It may have lower monthly payments, but in the long run you may be paying more than you ever anticipated. Always have the lender sit down with you and help you calculate exactly how much you will end up spending monthly and how much you will spend at the end of the loan term.

Fifth, when it comes to the deed of your property, always get the assistance or advice from a lawyer. Never hand over your deed to just anybody, or sign it up over to anybody. Let your lawyer look at the home equity loan terms and who the deed should be kept with while you fulfill your loan repayment term. When in doubt, always get the advice of a lawyer or someone you trust who knows all about home equity loans.

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