Have you built up equity in your home and are in need of some extra money, so you’re looking for a way to take advantage of it?  If so, then you’re like a lot of other homeowners during this economy who are struggling to make ends meet and looking for new ways to supplement their income.  Beware, this is exactly the climate that scammers take advantage of—they offer you options and deals that promise you exactly what you want, but they end up leaving you worse off than you started.  Coldwell Banker Select Professionals is providing the following information to inform you about the two of the most popular scams.

Equity stripping scams start with a homeowner who has built some equity in their home but still needs more money coming in each month.  An unscrupulous lender will encourage you to lie about your income level in order for you to get a bigger loan.  This lender does not care that you will now be unable to afford the new monthly payments, in fact, they are banking on this.  As soon as you stop making payments, the lender will foreclose, taking your home and the equity you built up on it.

Loan flipping is another way in which scam lenders dangle the temptation of extra income in front of you in order to get your money.  In this case, the lender will process a refinance for you to help you take advantage of the equity in your home. After you make the first few payments, they will attempt to convince you to refinance again with the bait that the rates have reduced significantly.  What they don’t tell you is that each time you refinance, there are fees and penalties that wipe out any advantage you gained.  You may have some extra cash, but you also have a lot more debt to pay back over a longer time period. 

Please contact Home National Mortgage for more information on refinancing and home loans.  If you’re looking for personal service you can trust and have questions regarding loans, be sure to connect with one of our mortgage specialists at www.homenat.com. They have local offices serving all of Lancaster, Lebanon, York, Hershey, Harrisburg, and Cumberland County PA.