Strategic Federal And State Criminal Defense

2 types of mortgage fraud to look out for

On Behalf of | Nov 18, 2019 | Blog |

Anyone who is dealing with loans must ensure they are only providing factual information. Any misstatements might be construed as fraud, which is sometimes a federal crime. If you are charged with any form of fraud, including cases related to a mortgage, empower yourself with knowledge of your rights and options.

Many people are shocked to learn that they can face mortgage fraud charges whether they are a borrower or involved in the lending process. The reasons why people commit fraud vary greatly, but there are some points that remain fairly consistent throughout these cases.

2 primary forms

There are two primary forms of mortgage fraud. One of these is fraud for profit, which is usually done by the individuals who are involved with the mortgage processing. The other is fraud for housing, which usually involves the borrower. Both of these are illegal and there are disclaimers noting this on the paperwork for mortgages.

Fraud for profit usually involves someone in the lending process misstating critical information about the application. This can include the borrower’s credit score, debts, income or anything related to the property. Anyone in the process from builders and mortgage brokers to real estate agents, appraisers and loan officers can commit this type of fraud. It is possible that more than one person in the process is involved in the fraud.

Fraud for housing sometimes comes out of desperation. The person is so desperate to find housing that they misstate facts on their application. In some cases, the fraud is done out of a need to make a fast profit. The reasoning behind the fraud doesn’t matter much when the elements of the criminal charge are present.

Intent is required

One of the primary things that prosecutors have to show is that the fraud was intentional. This isn’t a crime that you can accidentally commit. You must know that you are making misstatements about some aspect of the mortgage.

Mortgage fraud usually has a lengthy paper trail. Part of your defense strategy is going to involve reviewing this. Some people try to cover their tracks, but this can often make things worse. If you think that you are being investigated for this or found out that you are facing charges, consult your attorney right away to start exploring defense options. Trying to rush your defense in these cases is never a good idea.