Question:

Straw Buyer Definition

Answer:

Straw buyers are people who consent that their names and personal details are used by certain people with the purpose of obtaining mortgage loans with no purpose of ever inhabiting these homes. Sometimes a straw buyer will be offered several thousands for the favor, or they may never know that their name and information will be used on the loan application. Straw buyers are also asked to sign forged documents.

Straw buyers are usually involved in the so-called mortgage fraud rings. The initiator of the scheme usually leaves the country after successfully obtaining large loan amounts for overvalued properties, and the straw buyers may end up being sued by the lenders who extended the loan money.

Even if straw buyers claim to have participated in the mortgage fraud uninformed of the fraudulent activities of the perpetrator, they are responsible for participating in criminal offence.

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Common misspellings: mortage and morgage