Purchasing a home is a huge financial decision and has serious implications in the long run. Many individuals borrow finance from banks and Non-Banking Financial Companies (NBFCs) in order to buy their dream home. The borrowed amount along with a certain interest amount has to be repaid in regular installments over a period of time known as the loan tenure.
Increasing frauds in the housing loan industry
The home loan industry has witnessed a huge increase in the number of frauds. Some applicants steal another individual’s identity so as to get an easy loan approval. It has been noted that identity theft alone accounts for around 85% of the total fraud cases. Around 48 fraud cases per 10,000 applications were registered in the year 2014. However, this number has increased to 73 cases per 10,000 applications in the year 2015, indicating that there has been a 50% rise in the number of fraud cases related to housing loans.
There are also fake lenders in the market, who try to dupe individuals. Scammers impersonate the website of a well-reputed financier and trick prospective customers to apply for a home loan with them. Some scammers also ask loan applicants to pay an advance fee in order to process the loan application. The practice of phishing is also prevalent in this industry. Fraudsters lure potential borrowers into providing their financial details. On receiving the necessary information, they deduct a hefty sum from the applicants’ account. The number of such scams is increasing by the day, and hence it is necessary to be alert while selecting a financier. Opt for a well-established lender in the finance industry to avoid any scam.
It is imperative to beware of such scams in order to avoid getting duped. Never click on a link provided through an email or a text message. Such links usually redirect you to a fake website, which then asks you to enter your personal details. Also, do not fall prey to upfront fee scams. No financial institution asks for an advance fee. If you notice a scam, do your due diligence and report the same. It is necessary to be constantly vigilant in order to avoid falling prey to any kind of scams and fraudulent attempts.