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Scams Target Home Buyers

• A potential home buyer may ask you to use your good credit to obtain a mortgage in exchange for a substantial payoff. If you are approached to do this, realize that you will be liable for the mortgage, and may be subject to criminal prosecution.

• Unscrupulous lenders may quote you a low interest rate when you apply for a loan and then notify you that your rate has increased at the last minute. They also may surprise you with undisclosed “hidden fees.” If this happens to you, contact the home office of the lender. If the company is small and unwilling to cooperate, file a complaint with the BBB.

• Real estate agents and companies make up the Houston BBB’s number one source of inquiries. Some real estate agents may offer to take care of every aspect of your home purchase. You should investigate competitive prices for the services being offered by the agent. This will prevent you from falling into a situation where the agent may be receiving kickbacks to use a specific lender or title company.

• Many scam artists offer to clean up bad credit or obtain mortgage loans for those with poor credit. This requires an advance fee, but usually comes with a “money-back guarantee.” The loan falls through and the consumer never receives a refund. Advance-fee loans are illegal in Texas.

The Better Business Bureau does not endorse, recommend, or disapprove any product, service or organization.