Question:

How is real estate mortgage fraud done?

Answer:

There are many ways for committing a real estate mortgage fraud. Basically, mortgage frauds are done with the purpose to make profit, or purchase property.

Real estate mortgage fraud begins with falsification.

  1. The loan applicant lies about their income, their job, or they have paired up with the seller and inflated the house value.
  2. House appraisal has to fit everybody's expectations - the realtor and broker want their commission, the seller wants to sell the house, the buyer wants to get a house. The appraiser is the person, holding the answer and imagine the pressure over them.
  3. Credit reports, title insurance and tax returns are easy to falsify, especially with the right software and using stated income or no doc loans.

Property flipping can be a real estate fraud, with which someone buys a rotten house, makes cheap repairs and sells it for an inflated price. It is difficult to distinguish the fraud from a legitimate flipping as many real estate investors are buying fixer-uppers and do manage to sell them big.

Also, real estate investors sometimes declare they are buying a primary residence, to make use of higher LTV and lower rate loans.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
Link:
Why: Because FHA loans are insured by the US Federal Government they have very competitive interest rates and are easier to qualify.
Link:
Why: Know and protect your credit report and score.
Link: See All 3 National Credit Scores & 3 Reports Instantly, Online & Free
Link this QnA Print del.icio.us Digg
Was this Mortgage QnA helpful?
Not at all
  • Currently 3/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
 Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA:

Common misspellings: mortage and morgage