Posted on: June 30, 2020 Posted by: admin Comments: 0
How To Avoid Mortgage Scams?

Mortgage scams are not new in this world. Their inception happened right at the time of the beginning of the mortgage industry. The borrowers are always afraid of the fake mortgage providers, but they do not know how to avoid them because they do not know how to detect them. If you are also among them, you need help.

To avoid mortgage scams, you need to know how to detect them. Below are the few ways that can help you find the shady deals, and then you can avoid them? Simple!!

Only Good Reviews At The Website

Reviews always show you the other side of the coin, but only if they are neutral and honest. Some of them talk about ethical aspects of the mortgage service while some of them mention the weak points about the service. But isn’t it odd if all the reviews are in favour of the company??? No, something is fishy.

  • How to Avoid –

It could be the first thing to help you know that the mortgage lender or broker is fake. Such companies always fill their review section with 5-star rating reviews. A reliable name is never afraid of showing all types of (good and bad) reviews on its website. Compare them with the other lenders and brokers, and you can see a real difference between the two.

Not Showing Much Interest In Your Repaying Capacity

An authentic mortgage company always has countless questions about your repayment capacity. After all, that decides your efficiency to make the timely repayments of mortgages. A genuine lender can never avoid scrutiny of your financial conditions.

A fraud mortgage provider does not show much curiosity about your ability to pay the mortgage. In fact, it pretends as if everything is smooth and you can get the approval quite easily. Most of the people feel hypnotized at this time and they feel driven towards the promises made by the lender. But this is the red signal and one should give serious second thought before the final decision.

  • How to avoid –

Check the name of the mortgage service provider on the regulatory website to know if it is registered or not. Nothing can be more authentic than this method.

Demand For Extra Fee And Charges If You Have Bad Credit

Bad credit score people are the most vulnerable cases and become easy prey for the scam mortgage companies. Usually, fake brokers and lending companies show the fear of rejection to the applicant due to his poor credit score. In the name of following the right procedure, they tell that a bad credit score person has to pay a high fee and charges.

The fact is that a mortgage seeker with poor credit score has to pay higher interest rates but not the higher charges or fee. No rule can force you to pay a high amount as the processing fee. If you ever encounter with such offer make sure you ask for the adequate FCA backed reasons. It will reveal the reality.

  • How to Avoid –

Through knowledge, you can do this. Nowadays, an applicant can get funds without any fear of rejection if the income is good. In place of taking a wrong turn, follow a better approach.

Hire a broker (reliable obviously) and ask it about how to get a mortgage with bad credit but good income. It is necessary because, with credit rating issue, the available options are less in number to find them you need professional assistance.

The Promise Of Closing Date That May Sound Unrealistic

The closing date means that all the procedures and fund disbursement will be done a specified number of days such as 18 or 21 days. A fake mortgage provider or broking company always makes big promises on the closing date. They make you feel as if the things are going to happen instantly and beyond your imagination, the fund disbursement is speedy.

In the haste to get money, most of the borrowers miss paying attention to the importance of rational decision making. They even compromise with the interest rates and buy an expensive deal, pay high charges and whatnot. Are you also doing something like that? Do not do that. It is nothing but just a trap.

  • How to Avoid

Your patience helps to prevent such deals. You always look for the long-term benefits, the actual process takes time, and that is a fact. If some mortgage company is giving you a promise that sounds unrealistic, do not get impressed. You may regret it later.

Loan Flipping

Technically loan flipping is not wrong, but if your lender asks you to flip your loan, again and again, something is wrong. It wants you to avail their other mortgage deals. Primarily, it makes efforts that you to switch to the new deal while borrowing additional money. It is not correct.

  • How to Avoid

Never switch the deal until you are not convinced that the new deal will bring any positive change. Also, in case of any doubt, immediately contact the regulatory authorities and take legal help.

Relief From Foreclosure

A mortgage holder about to lose his/her property due to delayed or missed payments is always desperate to save the home. In such conditions, the tricky lenders present their deals as the last-minute saviour. They mention that they can help with a much cheaper deal and smaller instalments if the applicant is ready to pay a higher fee and that fee may cause hundreds or thousands of precious pounds.

  • How to Avoid

In place of relying on any other lender, go for financial or legal advice to find the right way. You should know that your financial vulnerability can bring you in the prompt notice of the fraud companies that manage to get access to public accounts.


The above scams are common in the mortgage industry, and you should work in the precise and required manner to avoid them. The biggest weapon is financial literacy as it keeps you safe from every fraud and scam.

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