Bait And
Switch

Mortgage Schemes

In the course of doing business we frequently talk with customers who are very reluctant to believe the straight-forward way we do business. Later we find out that they've fallen victim to a bait-and-switch scheme. There are many variations of mortgage financing bait-and-switch schemes. Hopefully you will avoid falling in one of these traps by learning about one common form.

We're going fishing!

Have you seen a newspaper ad that read, "3.99% Interest Rate"? That's the idea. The ad says more, but that's all they want you to remember. That, and their phone number. This is the "bait." So you call the loan originator (broker, bank, or another lending institution) and make an appointment to get your "3.99" rate.

The bait has done its job. You, their new customer, are in the door and have filled out an application. Isn't that a lovely office? A nice woman offers you coffee or a soft drink. You feel great. This is how they set the hook. While you're filling out an application you keep remembering that sign that said 3.99%. No one has told you don't qualify for that rate. In fact, only a select few can qualify for that loan program. But they don't tell you much of anything other than they need to order your appraisal that you'll need to pay for it.

After some additional pleasantries, you are told they will be in touch. So you go home feeling great about life. A few days later, you call back to check on your refinance. That's when they tell you the bad news. You don't qualify for that rate. In fact, you barely qualify for a loan at all. Right now, they have a special promotion, and if you act now they can fit you into the loan program. This is the "switch." You agree in a hurry, and rush right down with your required financial documents in hand, all because you've been told that this is the only program that will work for you. Unfortunately, they failed to mention the steep prepayment penalty or the high interest rate. Those surprises will be sprung on you at the closing table, after your bags are packed, and the movers are backing into your driveway. When it's too late to change anything.

Don't do business with unethical mortgage brokers, We have a better way.

There is a better way, and you've found it. You've reached this website. It's filled with information about mortgages. We don't make promises we can't deliver. The experience is completely different. First, we provide you with ample information here on our site before you decide to apply. After you look around and digest some of the information, you decide that you'd like to find out more. Now take the first step. Fill out an application. That's a good thing, but you also need to follow through and order your credit report.

You may already know your credit score. That's helpful, but scores change every day. With three separate credit reporting agencies we need to know all your scores, not just one. Besides, there are more than just credit scores on a credit report. It is this other information that sometimes will make a difference to whether or not you qualify for a loan. For example, many times there will be another person with the same name on your report. This person's credit history may be pulling down your score. See Credit Scores for lots of helpful information.

With the application and credit report we have a nearly complete picture. You also have an opportunity to provide us with more specific information on the application in the "Situation" text box.

Click to read about the services provided by Mortgage Brokers.

Once we do an initial review of your application we'll contact you at the time you specify is most convenient on your application. When we call, we'll get to know you and listen to your specific needs because we consider you to be more than just numbers and words in a file. You are a living, breathing person with challenges and responsibilities. You took that leap of faith and provided us with your financial information. Our job is to become your financial advisor. Our goal is to offer you the best of everything--from service to rates.

Here at Lightning Mortgage, we have hundreds of loan programs. We are licensed mortgage brokers who run interference with these many lenders for you. It is our job to find the best loans that meets your specific needs. If there are several, we'll provide you with choices and options. You are the decision maker. Our role is to make you aware of your options and to advise you. With that said, if there is a 3.99% interest rate loan that you qualified for based on your credit history and other financial information, we'd be happy to offer it to you.

Your interest rate is based on several factors. Mortgage (or rental) payment history is very important. You must continue to keep your mortgage paid until your new loan closes and funds. Otherwise, your credit rating will suffer. In fact, we ask you to sign a document called The Ten Commandments Of Mortgage Lending at the beginning of the financing process. It lists ten items that can and will cause your loan to be in jeopardy if not followed.

If you like our philosophy and appreciate doing business with a company that will treat you with respect, give you honest answers, and be upfront with you, then please apply today. If you have been a victim of a bait-and-switch mortgage scheme and would like to tell us your story, please tell us about it.

Next Steps

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Now You Can Learn Those Closely Guarded Mortgage Secrets and Save Thousands!

I'll show you step-by-step exactly what to look for and avoid when obtaining or refinancing a mortgage - especially if you've owned a home before.

Pleasanton, California

Dear Friend,

Of course, you want to pay the least for owning your home.

But you're received conflicting, confusing advice, and you don't know where to turn. You want to pay the least amount both at closing and with your monthly payments, and you should!

That's where I come in. I have saved thousands of home owners millions of dollars over the years. It has been my lifelong goal.

In the past 20 years money-saving strategies have changed as mortgage types and loan programs have multiplied. Over the years I've discovered exactly what works and what doesn't work when it comes to paying the least amount to own the same house.

Keep reading, and I'll show you exactly what works and what does not work when it comes to saving you the most amount of money.

The first thing we need to do is get you to understand what you're up against. Well-meaning family members and friends sometimes pass along misleading tactics and along with advice for avoiding bait-and-switch schemes as you discuss your plans for buying or refinancing a home.

Other times ill-informed or unethical real estate professionals deliver the information to you. They really aren't at fault.

Part of the problem is our own addiction to strategies that never work...

Four strategies for saving money that never work

...Yet people always try

The first is to scan the newspaper and look for the lowest advertised interest rate. Since interest rates are subject to change at least daily, the rate you'll receive has as much similarity to the advertised rate as today's winning lottery numbers have to tomorrow's numbers.
The second strategy is to partially fill-out loan applications on the Internet. You expect for lenders to "fight for your business" and judge the winner as the one who quotes you the lowest rate. This never works because there are too many unknowns and assumptions made.
The third strategy is leaving the choice to your real estate agent. Agents may have the best of intentions, but don't necessarily understand mortgage financing. Would you expect your psychologist to be up on the latest bone cancer treatments?
The fourth strategy is to just go to your local bank. If you are satisfied with any loan offered to you, then just trot down to your local bank.

You see banks have many different products (savings accounts, checking accounts, travelers checks, credit cards, ATM cards, Christmas accounts, car loans, etc.), but usually offer very few choices of loans.

If you think they'll make it easier to qualify since you have a savings account with them, think again. Loan underwriting qualifications do not check simply because you have been a customer of theirs all your life.

My strategy is to use the most appropriate loan product for each borrower's particular needs. It is not a matter of finding the best 30-year fixed rate mortgage. An interest-only mortgage may be most appropriate for you.

Is a second mortgage a better solution than a home equity line of credit?

Is really depends on how you'd like to repay the loan and how much you can afford to pay each month.

How can a person save money using negative amortization when the loan amount is going up as opposed to a traditional mortgage with the principal is being paid down?

You bet, but this option might not be right for you.

So what's the best way to obtain a mortgage?

Many people take a pessimistic view. They figure there's too much to learn, too many options. They just want to move into the home of their dreams, and be done with it. Spending a few dollars more each month is no big deal. Well, they are wrong.

Would you needlessly spend $50,000 to $200,000 more for a home than you need to pay? Probably not. But if you accept the wrong loan you could wind up over-paying even more for the same house.

What you Can Do Right Away to Turn The Tide in Your Favor

Buying a home is one of the most stress-filled, and most expensive, things that most of us will ever do. Here are three things that can make a difference:

I've discovered that arming yourself with knowledge about your loan options is the best defense against paying more than you need to pay when buying and owning a home.
Having a clear overall financial picture, and how your mortgage fits into that picture.
Working with and obtaining advice from a trusted source, a down-to-earth, level headed expert.

I am available to help you obtain the right mortgage. One that will meet your needs. Sign-up to receive strategies that will save you money, big money. I discuss many of them in my free Mortgage Insider Secrets series. This information will be emailed to you in weekly messages.

Sincerely,

Anthony Ferlazzo
Mortgage Consultant

Rest assured, we respect your privacy and will not give your email address to anyone under any circumstance.

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Bait AndSwitch

Mortgage Schemes

Mortgage Schemes

Next Steps

Now You Can Learn Those Closely Guarded Mortgage Secrets and Save Thousands!

Four strategies for saving money that never work...Yet people always try

What you Can Do Right Away to Turn The Tide in Your Favor

Sign Up and You'll Enter Our Web Site, Too!

Bait And
Switch

Four strategies for saving money that never work

...Yet people always try