One of the major things you will need to do if you are purchasing a new home, is to obtain a home loan. Unfortunately with the difficult economy and the availablity of loans more difficult, loan scams are on the rise. People with bad credit and the elderly are the most vulenderable and often targeted. Below are some tips to help you from being a victim.


Avoid Being A Victim

  • Avoid Unsolicited phone calls. Be wary of any phone call offering remarkably low interest rates on loans, especially if you have registered your phone number with the Do Not Call Registry. Most major nationwide lenders do not solicit business over the phone. Never give out personal information over the phone unless you are absolutely sure who you are speaking with.
  • Don't agree to anything with a too-high interest rate
  • Don't buy insurance from a lender without shopping around first.
  • Watch the terms for reinforcing. They might end up worse than what you've got now.
  • Don't sign anything that's been given to you as a surprise! If the terms aren't what you'd agreed on, do not sign the document.
  • Avoid bad credit mortgage rates when looking for a loan.
  • Many loan scammers use high pressure sales tactics, so if you feel pressured or uncomfortable in anyway, never sign anything. It is a good idea to contact a real estate lawyer if in doubt to review the documents. If the company is legit, they should have no objection to a lawyer looking over the loan agreements before you will sign them.

Warning Signs

  • Do business with reputable companies, stay away from unsolicited calls, e-mails or letters offering you a loan.
  • Never do business with anyone who asks for money to be sent in advance to cover "processing", "application", "insurance", or the "first month's payment". Legitimate lenders never ask for these things to be paid before a loan is disbursed.
  • Requests that you "wire" or "send" money, as soon as possible to a large U.S. city or to another country, such as Canada, England, or Nigeria, by Western Union, Moneygram, or similar means.

What To Do If You Think You Have Been Scammed?

If you feel that you have been scammed or the company you have been in touch with is suspicious, contact the below agencies.

  • The FTC
  • The FBI
  • File fraud alerts with each of the three credit bureaus. This is important if you have provided the scammers with your sensitive information, such as your Social Security Number and information on your driver's license. They can use this to obtain credit in your name.