Watch out for clever “Bait and Switch” on mortgage rates.

While doing some web research the other day, one of those pop up ads promised me a mortgage of up to $375,000 at a very low payment. It did not mention the interest rate, but the monthly payment was low, so I calculated the interest rate. It came out to about 4.3%.

That seemed like a low rate, so I went to the webs ite and filled out some information. Right away it came bakc and told me that “four companies” were anxious to bid on my loan at rates ranging from 6.1% to 6.5%.

Now, if I had not done the calculation already I might not know that the 6.1% rate offered was much higher than the loan rate implied by the original ad. They did not give me the monthly payments so I could not make an easy comparison.

Wihout knowing that the interest rate had jumped almost two points, I might have been tempted to go on; and as all these marketers know, the moe effort you put in, the more information you provide, the more likely you are to buy, even when the terms have changed radically from the ad that sucked you in.

For more information on mortgage rates, click here.

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