Mar
29
The facts are undeniable. Foreclosures are up to 7.6% from 7.3% of loans past due or in foreclosure. The biggest rise in these numbers relate to what are called sub-prime mortgages. These are mortgages that were sold to lower income families where the original starting payments were set at a reduced rate. When interest rates rose, the borrowers of this type of mortgage were caught out. Instead of having to make a payment that they had been quoted when the mortgage was sold to them, they faced much higher payments in line with the higher interest rate prevailing at the time.
Now its easy to say that this is their own fault and that they should have been more careful when entering into the loan and that the duty of care is on the borrower to ask about the risks involved and the potential downside that a rise in interest rates would cause. The worrying thing is though, that many of these loans were sold to people who were novices in owning their own home and such complicated financial instruments. They came from low income households and were ‘blinded’ by a dream that most of us take for granted.
I am not the only one who thinks so. The Attorney General in Illinois is already investigating Countrywide Financial Corp for its potentially illegal targeting of minority groups for the purchase of high cost loans. This is just one of many State and Federal investigations underway.
Countrywide is also under scrutiny as its CEO Angelo R Mozilo is now being investigated for possible illegal securities transaction in which he cashed nearly $120 million dollars worth of stock shortly before his company announced bad loans of $422 million in the fourth quarter of 2007. Countrywide who are currently being taken over by Bank of America has also been named by the F.B.I. today,(9th March 2008), as one of fourteen lenders being investigated for lending practices.
As with most investment stories, when people are losing money, there is usually someone making it. It emerged in recent days that Warren Buffet may be about to step in to take a stake in Countrywide. Mr Buffet, who recently topped the world list of the richest men on the planet, knocking off Bill Gates after thirteen years, has been sitting on a cash-pile of some $50 billion dollars for some time now. His investment company, Berkshire Hathaway has reported taking a stake in Bank of America recently and rumours abound that he is looking to get involved once again in the financial & mortgage securities markets. As usual, Mr Buffet, your timing is impeccable!
Even ‘The Donald’ could be seen recently on National TV bestowing the virtues of property investment. I have to agree with Mr Trump that those who have the ability to invest in property in a depressed market are possibly the people who will profit the most. For the average man in the street though, I think the message is clear. When taking out a home loan or refinance package, get some professional advice. Check the small print and know the downside before signing the agreement.
About The Author– Rebuild.org are specialist brokers of Mortgages , Home Equity Loans and Refinance packages. Know the market and whats available before committing to any type of financial arrangement.Read more financial articles at KFA Global
Article Source: Articles island – Free article submission and free reprint articles
Feb
8
By Monty Loree
I got a call at 6:30 am this morning ( OUCH ) from a young 20 year old woman got scammed with canwestcredit.com. She was at work and couldn’t spend alot of time reading our site which is full of information on these Bad credit loan scams.
This painted a scenario for somebody who would apply for a bad credit loan.
If you’ve got bad credit and recently have applied for a loan with Royal Bank, TD Canada Trust, Bank of Montreal, ScotiaBank, Bank of Commerce, and have been denied, then you need to take heed to that.
There are other lenders that may help you out such as HouseHold Finance, which is a HIGH RISK lender.
The point is, if you’re desperate for a loan, you’re probably going to shop at places on the internet that indicate that they can help people with bad credit.
The scammers are telling unsuspecting people that they can help give them a “bad credit loan”. This is obviously appealing to those who are desperate for money.
FIRST POINT TO KNOW:
It’s illegal for a loan company to ask for a fee or down payment up front in order to give you a loan. This is the first alarm bell.
If a bad loan credit officer asks you to wire them money via moneygram, or western union, your money will most likely disappear!!
SECOND POINT TO KNOW:
If you’re not familiar with the bad credit lender, then they may not be legitimate. If you’re seriously thinking of dealing with this company, you need to keep in mind that lenders and mortgage brokers must be licensed to do business in your province. You can call Consumer Protection-Corporations branch to see if this bad credit loan company is registered with the Provincial or Federal governments. ( Banks are registered Federally in Canada )
THIRD POINT TO KNOW
Just because a bad credit loan company has a phone number, doesn’t mean that they’re in Canada.. A phonebusters.com representative that I interviewed suggested that with the tools on the internet, scammers can get a phone Canadian phone number and have it forwarded to Hong Kong or some other far away place. This means that the predators might be living in a far off land while you think they’re in Canada.
FOURTH POINT TO KNOW – IDENTIFY THEFT
NEVER NEVER NEVER give out personal information such as social insurance number, date of birth, address to people or companies you don’t know. In this case, these bad credit loan scammers are more than likely going to steal your personal information and use it to buy products using your name. You’ll get the bill for these stolen products and get stuck with hours and hours of explaining to do with the suppliers that are being stolen from.
BAD CREDIT LOANS ON THE INTERNET ARE DANGEROUS
Here’s my advice… Even if you’re desperate for money, you need to take a few hours to research potential companies you’re going to use to borrow money from. They need to be registered, familiar, and credible.
If you DON’T take the time to research bad credit loan companies in Canada, you’re going to lose your money. It’s a hard lesson. It’s a hard reality. It’s the truth.
Don’t let bad credit loan scammers get away with murder. Do your homework before you borrow money!
Monty Loree is the founder of http://www.canadian-money-advisor.ca which helps Canadians better understand their money, credit and the financial industry in Canada. In our financial podcasts, we are interviewing industry experts who give our visitors the truth about the financial industry. Canadian Money Advisor is an important source for Canadians to learn more about their money.
Article Source: http://EzineArticles.com/?expert=Monty_Loree