Mortgage fraud accusations can occur in various circumstances
Getting a home mortgage should never involve illegal actions. Unfortunately, there are some instances in which mortgage fraud becomes an issue. This is a white collar crime that is taken very seriously.
Mortgage fraud is a type of financial institution fraud, which means that the Federal Bureau of Investigation can take charge over the matter. A person who is facing accusations of this crime could face federal charges. Here are some points to know about mortgage fraud:
Who commits this crime?
Anyone who is involved with the process can commit mortgage fraud. This includes the person who is seeking it, as well as underwriters and lenders. It is imperative that everyone working on a mortgage take the time to ensure that they are acting with integrity and keeping everything honest.
Why is mortgage fraud an issue?
Mortgage lenders base their lending decisions on the information provided in the mortgage application and related paperwork. There are certain requirements that these companies have in order to keep the business afloat and avoid bad mortgages. This helps to protect everyone involved with the company, including other borrowers and investors.
What, exactly, is mortgage fraud?
Mortgage fraud occurs when a potential borrower isn’t fully honest on the application and paperwork. It also happens when a person who is writing the mortgage or can benefit from it is dishonest. There are some instances in which fraudulent loans are written to boost a person’s profit. These can include ones written to deceased individuals or fictitious entities.
How is mortgage fraud unearthed?
This crime usually comes as the result of a lengthy investigation, which can include audits of specific applications and mortgages. Reports about “fishy” mortgages might trigger the investigation, but it might also occur as a result of a regular checkup on the status of mortgages for a company. Delinquency or nonpayment might also lead to an investigation.
What should people charged with this crime do?
You need to get started on your defense right away. Some individuals might know that they are going to face charges before they are levied. In these cases, you can work on a defense before you are officially charged. Starting early and being willing to work on your side can help since the paper trail is often lengthy. One thing that you shouldn’t do is try to cover up the mortgage fraud with dishonesty. It is possible that the cover-up could cause more problems than the initial issue.