Getting the right home means going for a mortgage you can afford. However, if it seems like you’ll grow old while sending those mortgage payments, getting a home equity conversion mortgage, or HECM, is one way to put an end to them forever, says the Simple Dollar. However, finding the right lender could be a bit of a challenge if you don’t know what you’re doing. Here are a few types of mortgage scams to help you identify bad lenders.
Sky-High Interest Rates and Fees
Too many rates and fees can make for a bad deal, so do your research. Don’t be taken in by an engaging personality. Know if the HECM lender is offering you a good rate or not. If there are too many fees, keep looking.
Aggressive Marketing Tactics
Plenty of lenders employ charming and engaging agents to recruit clients. However, if the marketing tactics they use border on being too aggressive, and if it feels like they’re forcing you to take the loan, that’s a major red flag. Walk away.
Not the Right Option
Is HECM the right option for you? If the lender cannot properly justify why you should opt for an HECM over other financial products out there, then that could be a sign you’re dealing with a bad lender. Also, the right one should offer you a bevy of choices that are a good financial option for your situation.
If the Lender Only Cares About the Loan
A good lender will ask questions to determine if a home equity conversion fund hits the mark for you. However, if the lender seems more interested in making you get the loan than in whether it’s the right tool for you, then that’s your cue to move to the next lender on your list.
Be on the lookout for these qualities. When you see them, run in the other direction—fast! On the opposite side of the spectrum,