Mortgage fraud takes places when a person intentionally provides erroneous data on a loan application in a bid to get a mortgage that he or she probably would not have qualified for had he or she entered accurate information on the loan application. You need to be aware of this sort of crime so that you don’t fall prey to con artists.
What is Mortgage Fraud?
Various sorts of mortgage fraud exists. One very popular one involves a criminal finding an unsuspecting person with good credit to serve as a so-called straw buyer. As part of this scheme, the crook will seek to have the straw buyer place his or her name on the home mortgage form. The con artist may, in exchange for the straw buyer’s assistance, promise to pay a sum of money or offer some other incentive.
Although the promised payday may prove alluring to the straw buyer, the truth of the matter is that the straw buyer will be the one left to shoulder responsibility should the mortgage default. If it’s proven that the straw buyer understood that he or she will fully engaged in fraudulent activity, he or she could be forced to cover any post-property sale shortfall, and could also be dealt criminal charges.
How Can You Remain Safe From Mortgage Fraud?
Fortunately, there are plenty of ways to steer clear of mortgage fraud. For example, you should refuse to accept any payment or reward offered to place your name on a mortgage application unless you plan to buy the property in question.
Another tip is to work only with real estate agents and other industry professionals. You also need to, among other things, keep your personal information private. Nefarious people who have access to your personal information can potentially use ID theft in order to commit mortgage fraud — without your knowledge.
Don’t fall victim to mortgage fraud. When purchasing or refinancing a home, be sure to go through the proper channels to get your business taken care of properly. If you work with industry professionals, steer clear of too-good-to-be-true offers from potential con artists and guard your personal information. This way you’ll be able to safely purchase or refinance your home.
source: northwoodmortgage.com
