Marketplace Morning Report Beware of shady refinance offers
Dec 10, 2025
Jacob Faber, an associate professor at NYU and mortgage industry researcher, sheds light on the pitfalls of refinancing. With the Federal Reserve hinting at interest rate cuts, he warns homeowners about offer scams that promise 'no cost' but hide significant fees. Faber highlights red flags to watch for, such as 'too good to be true' claims and aggressive tactics. He also emphasizes the importance of seeking second opinions and utilizing state resources to make informed refinancing decisions, ensuring homeowners don't fall victim to deceptive pitches.
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Fed Cuts Don’t Guarantee Lower Mortgages
- A Fed rate cut doesn't automatically lower mortgage rates because other bond-market forces can push mortgage rates up.
- Market expectations about future central bank moves can counteract immediate policy shifts.
Caller Promised Free Refinance, Led To Fees
- A reporter's mother got a call promising a cost-free refinance and lower payments, but ended up responsible for fees and new loan terms.
- Jacob Faber says such calls are common and can be either scams or real offers that don't help borrowers.
Legal Packaging Can Mask Harmful Costs
- Wrapping refinancing costs into a loan is legal but can still harm borrowers' long-term finances.
- Jacob Faber warns lenders' incentives favor profit over each borrower's best choice.