Don't fall for these mortgage refi scams

Julie C. Nichols General

Reblogged from CBS Money Watch – Mitch Lipka

All the talk recently about the possibility of the Federal Reserve hiking interest rates prompted a warning on Tuesday from the Better Business Bureau to homeowners considering refinancing their homes.

When you get the pitch — it could come by email, phone or even a printed flyer — it’s going to come with a promise that refinancing will lead to a savings of several hundred dollars a month on mortgage payments. Other versions of the scam aim at those behind on their payments or who owe more than their property is worth, the BBB said.

"There’s one big catch. The ‘company’ needs you to pay (an upfront fee) in order to lock in your rate, sometimes as much as thousands of dollars," according to the BBB. "Once you hand over the payment, the ‘company’ vanishes with your money." A request for a homeowner to pay a fee before even applying for a loan is a big red flag.

Here are some other signs from the BBB to help identify a mortgage-related scam:

>> Read More: http://www.cbsnews.com/news/dont-fall-for-these-mortgage-refi-scams/

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