Without resources and experience in the realm of lending legislation, the answer to this question is almost impossible for the average borrower to answer. If the borrower had the time, energy, and know-how to conduct his own research into his own state�s current laws regarding loans and mortgages, then it is definitely possible to educate oneself as to what is appropriate and acceptable, and then analyze his own contract.
However, to be realistic, it is unlikely that your average American will have the time or energy required to conduct such research on his own. If the legitimacy of a borrower�s contract becomes a concern, the best advice is to seek the assistance of a qualified real estate attorney. The attorney will have access to references, and will have real-world industry experience, that will make answering this question much easier. This is especially true since there are countless attorneys who offer free initial consultations for such purposes, and the availability of qualified counsel is everywhere.