Question:

Is mortgage fraud stated income possible?

Answer:

Unfortunately, stated income loans make mortgage fraud very easy to accomplish. They are called liars loans because the borrower can lie about their income and get away with it very easily. Loan officers are well aware of that fact and sometimes, under given circumstances, would suggest a little number play.

Stated Income Loan Dangers

Even though stated income loans are great tools for diligent borrowers who cannot fully document their income for some reason to get a loan with good rates, stated income loans allow easy mortgage fraud. Some borrowers eagerly looking forward to their luxury home could get themselves a loan they cannot repay. Overstating income does constitute mortgage fraud, and some lenders do warn borrowers of the legal responsibility for the information on their loan application.

Sometimes, a loan officer would advise borrowers to get a loan with a little twist on the stated income application. However, if income exists in one form or another, there is little danger for the borrower to fall behind with payments and it depends on the borrower if they are willing to go this way.

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Common misspellings: mortage and morgage