Marketplace All-in-One Beware of shady refinance offers
Dec 10, 2025
Jacob Faber, an associate professor at NYU specializing in the mortgage industry, sheds light on the dangers lurking in refinancing offers. He warns homeowners about seemingly attractive deals that could lead to hidden costs. Faber highlights red flags to watch for and emphasizes the importance of getting second opinions before making financial commitments. With recent Federal Reserve rate cuts, he explains how bad actors could take advantage of unsuspecting borrowers seeking lower rates.
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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 moves can push mortgages up.
- Market expectations about future central bank actions affect long-term bond yields and mortgage pricing.
No-Cost Refi Call Gone Wrong
- A reporter's mother got a call promising a no-cost refinance that would lower her monthly payment.
- The mother ended up responsible for refinancing fees and new loan terms instead.
Legal But Not Always Beneficial
- Wrapping fees into a refinance is often legal even when it harms the borrower.
- Lenders' incentives are to make profit, not necessarily to serve each borrower's best interest.