Frustrated with Bait-and-Switch Tactics by Lenders

Seeking Advice
1

Hallo…

I’ve been in the mortgage game for a while, and something that drives me crazy is how many lenders out there use bait-and-switch tactics. It’s wild how often this happens, even with licensed lenders who should know better.
I’ve had borrowers show me loan estimates that are clearly fake, convinced they’ve locked in some amazing deal with rates that don’t even exist in today’s market. It’s frustrating trying to explain that these numbers are bogus, and when they get to closing, the docs won’t match what was promised.
I see this all over—from wholesale brokers to credit unions. I spend so much time going through these fake estimates with borrowers, line by line, explaining why it’s not legit. But they still expect me to match or beat numbers that just aren’t realistic.
So, I’m wondering: * Why do so many lenders pull this crap?

  • Anyone else been dealing with this lately?
  • How do you explain this to borrowers without them losing faith in you?
    Regards…
2

Offering a cheap interest rate but tack on unanticipated costs such as origination, processing, or prepayment penalties.

3

promoting one type of loan while attempting to sell the consumer another, usually one with a worse interest rate or other costs.

4

Prior to signing, always carefully read over the loan documents. Be mindful of any conditions or additional costs that aren’t immediately clear.

5

Never take the first offer that you are presented with. Get quotations from many lenders and evaluate :unamused:the differences in terms, costs, and rates.

6

Be wary if a lender offers :wink: an exceptionally low interest rate. The loan can have additional conditions or unstated costs that detract from its appeal