December 2008

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"Free Security Scan" Could Cost Time and Money

Reduced home prices tempting you to house shop? Be aware: Subprime lending tactics now being used to market some FHA loans—read Business Week’s investigative report.

Not all subprime mortgage brokers and lenders have disappeared. These are the types of firms that, through their risky lending practices, helped create the current financial crisis. Many have reinvented themselves by issuing federally insured mortgages. These mortgages are backed by the Federal Housing Administration (FHA). What's wrong with this? These lenders may now be using the same questionable techniques used earlier to push risky subprime loans to issue FHA backed mortgages to people who don’t qualify for the loans and may be unable to make their payments, leaving the FHA (and ultimately taxpayers) to pay out insurance claims.

If you're the market for a mortgage, CCU can help.

For more details, read the Business Week article, FHA-Backed Loans: The New Subprime