Predatory Lender Red Flags: Lies, Deception, Bank Account Access

In part one of this two-part blog series, we went over some of the key red flags that indicate you might be dealing with a harmful or predatory mortgage lender. Unfortunately, such predatory individuals and entities are present in many loan areas, from auto loans to home loans and more — but if you know how to spot them, you can steer clear of them entirely and avoid any risks.

At Primary Residential Mortgage, we’re happy to not only offer a wide range of mortgage loans and the best mortgage rates in Guilford, but also to assist clients as they look to ensure they aren’t being taken advantage of in any way. What are some of the other possible indicators that a lender is predatory or otherwise harmful and should be avoided? Here are several.

Instructing Clients to Lie on Application

In any case where a lender you’re working with advises you to be untruthful on your loan application in any way, it’s an immediate red flag that you’re dealing with someone who does not have your best interests at heart. It doesn’t matter if they tell you that “everyone does it” or that the lie is a small one and won’t affect anything — if they’re encouraging dishonesty, they cannot be trusted.

Not only this, but proceeding with such a lender actually opens you up to fraud charges in many cases, so it’s not worth the risk at all. It’s always best to be completely transparent on your loan application form.

Deceptive Data, Graphs or Rates

Another common tactic used by predatory lenders is presenting their clients with data or rates that are designed to be misleading in some way. This might involve showing a client a graph of “projected savings” that is based on inaccurate assumptions, for example, or showcasing interest rates that don’t include important terms and conditions.

In any case where you’re looking at data or rates from a potential lender and you’re not sure what they mean or you feel like something might be off, it’s always best to ask for clarification. A legitimate, trustworthy lender will have no problem explaining their rates and data in full.

Asking for Bank Account Access

If a lender you’re considering asks for your bank account login information, it’s a major red flag. In some cases, this might be a simple case of the lender wanting to check up on your financial history, but in other cases, it could be a sign that they’re looking to commit fraud.

In either case, it’s not worth the risk of giving away your bank account login information. If a lender needs this information for any reason, they should be able to explain why and provide an alternative way for you to give it to them.

For more on how to spot predatory or otherwise harmful mortgage lenders and steer clear of them, or to learn about any of our mortgage rates or quality home loan services, speak to the team at Primary Residential Mortgage today.

*PRMI NMLS 3094. PRMI is an Equal Housing Lender. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs, rates, terms, and conditions are subject to change and are subject to borrower(s) qualification. This is not a commitment to lend. Opinions expressed are solely my own and do not express the views of my employer.