Mortgage fraud includes various illegal schemes involving material misrepresentation, misstatements, or omissions that relate to property or a potential mortgage.
In general, mortgage fraud involves two parties: the party providing false information and the party that relies on that information to complete a transaction.
It can be committed by both individual borrowers (fraud for housing) and industry professionals (fraud for profit).
Let’s look at five common mortgage fraud schemes:
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This introduction just scratches at the surface of the myriad types of “traditional” mortgage fraud and how to avoid them.
But the face of mortgage fraud is constantly evolving. Just this week, Bank of America was hit with an $864 million mortgage fraud fine for selling subprime mortgages, the defective securities largely responsible for triggering the Great Recession in 2008, to government-owned enterprises.
For additional guidance on anything from foreclosure frauds to subprime shenanigans, you may want to consult an experienced real estate attorney.
Related Resources:
- Mortgage Fraud (Federal Bureau of Investigation)
- Department of Justice Task Force Targets Mortgage Fraud (FindLaw’s Law and Daily Life)
- FBI Mortgage Fraud Report: Scams Up in 2008 and More to Come (FindLaw’s Common Law)
- Federal Authorities Focusing Energies on Stopping Mortgage Fraud (FindLaw’s KnowledgeBase)
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