With the economy improving in Florida and elsewhere, you are likely to have more borrowing options than in years past. This may be true even if you have gone through a bankruptcy or foreclosure. Given enough time and some good financial habits, you should be able to recover from a foreclosure or bankruptcy sooner than you might think.
Many banks take into account the fact that bankruptcy is relatively common these days, and they are often willing to extend credit. However, it is important to understand that some lenders use the uncertain period after a bankruptcy or foreclosure to prey on vulnerable consumers. You might find yourself in financial trouble if a predatory lender takes advantage of you.
According to the National Association of Consumer Advocates, unscrupulous lenders usually focus on bleeding as much as they can out of customers. They often employ unethical fees or outrageous interest rates. What are some of the other ways you might be victimized by a predatory lender?
Your prospective lender might aggressively try to get you to sign for a subprime mortgage when you might qualify for a standard loan instead. If you repay your loan ahead of schedule, you might face a heavy prepayment penalty. Your broker could make a sizeable bonus from extra fees tacked onto your loan or from unnecessary items you were convinced to include in the contract. Perhaps most disturbingly, you might be prevented from taking a fraudulent or abusive lender to court. Instead, you could be forced to arbitrate your case with an arbitrator who is biased toward the lender.
Knowledge is one of the best defenses you have against being victimized. The content of this blog should serve as general information, but should not be taken as legal advice.