Avoiding Mortgage Fraud
Unfortunately, fraud and
identity theft are increasing at an alarming rate every year, and mortgage
fraud is one of the most important types of fraud from which you will want to
protect yourself. So what constitutes
mortgage fraud, and how can you prevent this from happening to you?
What Is Mortgage Fraud?
Essentially, mortgage
fraud is defined by the FBI as any material misstatement, misrepresentation, or
omission relied upon by an underwriter or lender to fund, purchase, or insure a
loan. There are several different types
of mortgage fraud, and each is a serious offense that can have a huge impact on
you and your credit. Here is a basic
list of the most common types of mortgage fraud.
Undisclosed Kickbacks-This
includes any financial deals between a buyer and seller that are not included
in the mortgage documents.
Falsifying
Income-Inflating your income is a serious offense on any loan document,
especially a mortgage.
Undocumented Non-Owner
Occupancy-Rates and other fees can be higher for income and rental properties,
but resist the temptation to hide this fact in order to save money.
Inflated Purchase Price-In
some cases this method is used to obtain a higher appraisal of a property, but
it is illegal and may cost you your home.
How To Protect Yourself
The purchase of your home
will probably be the greatest financial investment you will ever make. Ensuring that you know what constitutes
mortgage fraud is half the job, but it is also important to know how to protect
yourself from professionals who may not have your best interests in mind. In general the best method is to ensure that
your real estate agent and mortgage lenders are professionals with considerable
experience, professional credentials, and good references. It is also important to keep in mind that if
an offer seems too good to be true, or if you feel that your Premier Beach Realty Agent or lender
has given you advice that sounds as if it might fall under the category of
mortgage fraud, you seek the advice of another professional. In this way you
can avoid getting yourself into what may be a potential financial disaster.
Your property is not only
your home, but also your greatest asset, and losing it to mortgage fraud can be
avoided when you are armed with these facts.
