The State of New Jersey
NJ Department of Banking and Insurance
Home > Consumer Information > Mortgages/Predatory Lending > Predatory Lending Warning Signs
Predatory Lending Warning Signs
If you've recently closed or are about to complete a home loan that is not at a prime lending rate, or comes with significant points and fees, you should ask yourself these checklist of questions to protect yourself from entering into a potentially predatory loan.
Do you believe there was general deception on the part of Loan Officers and/or closing representatives on behalf of the lender/broker? Yes No
Were you encouraged to include false information on your loan application? Yes No
Were you asked to leave signature lines or any other important line-item of any form blank? Did the lender or broker alter any information you entered on your loan application? Yes No
Did the lender charge excessive points at closing, have a significant range of fees on Good Faith Estimate ("GFE"), or change of loan terms? Yes No
Did the GFE contain a range of costs so large that it failed to provide you with a fair estimate of cost you face at settlement? Yes No
Did the lender not supply you with all necessary disclosures (i.e., Good Faith Estimate, Truth-In-Lending, HUD-1 Uniform Settlement statement) prior to closing? Yes No
Were you unaware of placement of mortgage life insurance on the loan? Yes No
Do your documents reveal that your interest rate calculation will change to require you to pay "daily interest" in instances when your payments are late? Yes No
Is your loan amount on the loan you obtained higher than the value of the home? Yes No
Did the loan have you pay points that did not buy down interest rate? Yes No
Did the new loan flip a relatively recent loan? Yes No
Did the loan provide you with no tangible net benefit? Yes No
Did the lender fail to disclose or verbally misrepresent pre-payment penalties and other fees until closing? Yes No
Did the loan officer verbally misrepresent a prepayment policy? Yes No
Did the lender not supply document copies at closing for use during 3-day right of rescission period? Yes No
Did the lender use various "bait and switch" scenarios? Yes No
Did the lender delay the loan closing to purposely have lock-in/commitment deadlines expire so that the interest rates rise? Yes No
Are there fee discrepancies on original disclosures versus revised disclosures given at closing? Yes No
Are mortgage commitments and Lock-in Agreements not being honored by the lender? Yes No
Did the lender misrepresent the terms of a bi-weekly mortgage payment program? Yes No
After settlement, were you surprised to find that the monthly payments on your mortgage loan were higher than you anticipated based on the initial disclosures? Yes No
If you have a balloon mortgage, will you need to obtain another loan to finance that final lump-sum amount? Yes No

Were you a victim of a lender and contractor second mortgage home improvement scam (lender and contractor take money - consumer gets no work done on home - classic predatory loan scheme)?

Yes No
If you answered "yes" to any of these questions, you may be or have been a victim of a predatory home loan.

For assistance, contact the Department.

OPRA is a state law that was enacted to give the public greater access to government records maintained by public agencies in New Jersey.
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New Jersey Department of Banking and Insurance