Maxres, Inc.

Predatory lending is a set of lending practices that takes unfair advantage of consumers. Consumers end up taking out loans that they cannot afford have deceptive or unclear terms in them or which cost more than necessary and may ultimately lead to the loss of ones home. Most predatory loans occur in the sub-prime market but not all sub-prime lending is predatory. Consumers need to be aware of predatory lending practices when searching for a loan. We urge consumers to be aware of the variety of predatory lending practices that are occurring with some lenders in the industry: Equity stripping occurs when a loan is made based on the equity in a property rather than on a borrowers ability to repay the loan. These loans usually result in the lender acquiring the borrowers home and any equity the borrower had in the home. Packing is the practice of adding credit insurance or other extras to increase the lenders profit on a loan. Flipping occurs when a lender induces a borrower to repeatedly refinance a loan often within a short time frame charging high points and fees each time. Traps are terms within the loan that will likely force the borrower to refinance or enter into foreclosure. Traps include balloon payments negative amortization prepayment penalties and mandatory arbitration. Don't be rushed into signing a loan because it is a limited time offer. A lender in a hurry to get the loan should serve as a warning sign to take extra care to make sure that the loan is being properly structured. Never sign documents with blank lines. Be sure that every space is filled in on the loan application before you sign it. Don't lie on your loan application. When you apply for a mortgage loan every piece of information that you submit must be accurate and complete. Lying on a mortgage application is fraud and may result in criminal penalties. Never pay upfront fees without an explanation. Do not pay sizeable upfront fees. Reputable brokers and lenders do not charge high upfront fees.