• Mortgage Fraud

Over the time, Mortgage Fraud has become more prevalent and is particularly a major concern during the current economic recession. There are different ways in which mortgage frauds can be concluded including upheaval in housing markets, homeowners facing foreclosure and unscrupulous persons looking for easy money.

Mortgage frauds can be committed from both lender and applicants side be it in the form of misstatement or misinterpretation of any material, omission is done by an underwriter or lender to fund, purchase or insure a loan. Talking about the same. The fraud can be as minor as you might not think the misinterpretations or omissions are significant enough to be concerned. But that ultimately is a trap and hence will lend you great losses.

Activities that are listed in mortgage frauds in details are as follows -

 

  • Inflating the price to obtain a mortgage for more than what is worth the property.
  • A borrower making claims for income and assets that he/she does not even have.
  • Posing as a borrower on behalf of the person who is actually making the purchase.
  • Pretending to render financial help to the one who is financially stressed in order to just skim off equity from the home.

Types of Frauds -

There are basically two different types of listed frauds -

There are mortgage frauds which involve the activities that are undertaken to defraud the lender such as trying to obtain the loan that you cannot legally qualify for.
Other mortgage frauds target customers such as foreclosure prevention or loan modification scams.

How to prevent mortgage frauds?

Mortgage fraud is a crime and is taken under the law by various federal and state laws. Most of the time borrowers tend to depend on lenders or on the brokers for the application and other requirements done to avail the mortgage. However, this is not the sign of a responsible borrower. It is important for a mortgage seeker to do their home work for searching a reliable lender, for sometimes even the bvro9ker don’t have the best intention’s for a borrower in the mind.