"Mortgage transactions provide ample opportunities for fraud. They do so because they involve multiple parties and large sums of money. These transactions are part of the lending process for buying a home. Some such schemes are sophisticated and unique, but the following types are the most common: Fraudulent Supporting Loan Documentation: A loan applicant submits forged or altered paycheck stubs. They might submit other fraudulent documentation."
"Property Flipping: A piece of real estate is purchased, appraised at a falsely inflated value, and then quickly resold. The fraudulent appraisal makes this practice illegal, as "flipping" during a housing boom is not necessarily illegal. Straw Buyers: The borrower's identity is concealed through the use of a nominee, whose name is used for credit history on the loan application."
"Stolen Identity: A mortgage loan applicant uses a fictitious or stolen identity. If stolen, the true person's name, personal information, and credit history are used without their knowledge. This variety of mortgage fraud involves identity theft. Equity Skimming: An investor uses a straw buyer, false credit reports, and false income documents to get a mortgage in the straw buyer's name. The straw buyer signs the property over to the investor after closing, relinquishing all property rights. The investor makes no payments but rents the property."
Mortgage transactions involve multiple parties and large sums, creating opportunities for fraud within the lending process for buying a home. Common schemes include submitting forged or altered income documentation; purchasing and quickly reselling property at falsely inflated appraisals; using straw buyers to conceal the true borrower's identity; taking undisclosed 'silent second' mortgages to cover down payments; and using fictitious or stolen identities to obtain loans. Equity skimming involves an investor obtaining a mortgage in a straw buyer's name, taking control of the property, failing to make payments, and collecting rents prior to foreclosure. Misrepresenting primary residence status can lower interest rates and incentivize fraud.
Read at Boston Condos For Sale Ford Realty
Unable to calculate read time
Collection
[
|
...
]