Posted on February - 10 - 2010
4 Tips to Protect Yourself from Predatory Lending
Predatory lending practices are any that are intended to lead a borrower into a loan he or she cannot reasonably afford. Lenders with statistical data and recommended guidelines understand the types of loans borrowers can afford better than borrowers themselves. As a result, lenders are often a source of advice when borrowers are uncertain over their ability to afford a loan. Some lenders abuse this power and give poor advice. When this happens, there are steps you can take to protect yourself.
#1 Be Informed
The US Department of Housing and Urban Development provides resources to help consumers stay informed about common predatory lending practices. Before you begin seeking any loan, you should familiarize yourself with this information. One helpful resource is the classes offered by the HUD to help you learn about the loan process. While this mostly applies to mortgages, many loans follow the same principles as a basic mortgage.