loan terms

Do I understand the loan terms?

· Before borrowing, you should know exactly what you're getting and what you're paying. Never be afraid to ask the lender to explain any fees, terms or conditions you don't understand. And never sign a blank form.
· Make sure what you sign is what you agreed to verbally. Don't sign any contract that does not agree with what the salesperson presented.

Also:

· Ask yourself if prepaying for credit life insurance is the best way for you to go. It will protect your family by paying off the loan if you get sick or die. But paying it up-front can add to the monthly cost of your loan.
· Think twice about a loan that has a large amount due at the end of the scheduled payments. This
one final, or "balloon," payment could be beyond your ability to repay.
· Watch out for lenders who tell you not to worry if you find you can't pay your mortgage—they'll help
you refinance your loan if you need to. Predatory lenders make money from the high fees and
closing costs they'll charge you to refinance the loan they knew you couldn't afford to repay in the
first place.
· Never sign a loan contract until you have all the facts—and understand every part of what you're
signing. Ask for advice from someone you trust: a banker, an accountant or a family member or
friend who has had experience with getting and paying back loans. Or call a local nonprofit credit
counseling agency for free help (you'll find them in the Yellow Pages).
· Remember that you have the legal right to change your mind for any reason within three days of
signing most loan contracts that use your home as the security.