Lender · Los Angeles, CA · Member since 2009 · 1k+ posts · 2k+ votes
1mo
I'm sorry this happened to you, @Angela Nakajima. Upfront fee scams are one of the oldest frauds in private lending. Given today's competitive lending market, however, the only upfront costs a legitimate lender should typically request are for an appraisal and, possibly, a credit check. The appraisal should be paid directly to the appraiser, and a credit check should cost no more than about $50. In most cases, that should be your maximum financial exposure before closing.
That said, some lenders either haven't gotten the memo or still charge application, due diligence, commitment, or other fees in the hope that borrowers will pay them. In the commercial lending world, those fees can be completely legitimate. That's generally not the case for a typical single-family residence (SFR) or other 1–4 unit residential purchase.
Also, it's worth noting that deals fall through all the time. That alone doesn't necessarily mean the lender acted improperly or ripped you off. If you're comfortable sharing more details about what happened, it would be easier to understand why you believe you were treated unfairly.
Bradenton, FL · Member since 2015 · 5 posts · 4 votes
1mo
I want to give you an update. I was almost scammed by Metro Flippers Investments but thanks to AI I was able to avoid it. The reason I posted was to let other investors avoid being scammed by them.
Investor · Roseville, CA · Member since 2009 · 1k+ posts · 583 votes
1mo
@Angela Nakajima I just checked out their website and I was surprised they listed a business address in Sacramento. I am in the Sacramento area and I bet that if I went to that address, it would be one of those meeting only offices for a business not related to lending. If a lender wants money upfront ,it is a scam and they are probably in another country.