Mortgage and Real Estate Newsletter May 26, 2005

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1. Interest rates.

2. Note and mortgage brokers. Beware of flip scams.

3. Predatory lending.

4. Mortgage-investments.com is now rated No. 1 by Google. How this helps you.

5. A 5 function financial calculator on your desktop. No cost.

1. Interest rates.

Mortgage interest rates for conventional lending have now dropped slightly.
For the latest interest rate survey and monthly and annual historic rates.

2. Flip scams.

A flip scam is where the scam artist buys a property, usually run down and in a bad area for a very low price. They then make cosmetic improvements and re-sell it to a borrower for an inflated price. The scammer get an appraisal based on this inflated price.

The appraiser may be in cahoots with the scam artist, or may just be amenable to pressure. Likewise, the buyer/borrower may also be in cahoots with the seller/scam artist.
Sometimes a phoney loan package is drawn up, complete with fake tax returns and credit reports. The borrower may seek a loan from a private investor or sometimes the seller/scam artist will give them seller financing at a high interest rate and will then seek to resell the note at a discount. The end result is that the loan goes into default and the lender ends up re-possessing the property only to discover it is worth far less than the loan amount. The way to avoid falling victim to these scams is personally inspect the property yourself and verify the values of the comparable properties used by the appraiser and double check all documents, including the credit report, tax returns etc. More on loan fraud

Please note that most real estate investors are genuinely capable of finding a good deal, do proper repair work and the property is REALLY worth the new appraised value.

3.Predatory lending.

There are both Federal and states laws now in most states controlling such things as the interest rates lenders can charge, the terms of the mortgage, how often the borrower can refinance with a lender etc. The Federal law is the Home Ownership Equity Protection Act or HOEPA. We cannot advise on the State laws as they do, of course, vary from State to State.

In some cases additional notices are required. Other practices are banned altogether. These laws mostly relate to Residential lending and not to borrowers who are investors. The laws can sometimes have a bad effect. For example, in Florida it used to be possible to make short term loans to people in financial distress. They might be in the process of foreclosure and about to lose their home. They might be very happy indeed to pay a high interest rate on a short term loan to save their home and give themselves a fresh chance to straighten out their problems.
As Florida now bans short term high interest loans, they cannot be made. Thus these borrowers can end up losing their homes.

4. Mortgage-investments.com is now rated No. 1 by Google. How this helps you.
Try a search on www.google.com on the terms "sell mortgage" "hard money mortgage" "mortgage investments" and you will find that Mortgage-investments.com occupies the top spot. 

What this means to you is that mortgage-investments.com is the best place to look if you want to sell your mortgage, borrow money or lend money for real estate.

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For many useful tools you may not have known we have, go to: More real estate and mortgage resources.

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