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Stay Away from Mortgage Fraud

The Federal Bureau of Investigation defines mortgage fraud as "any material misstatement, misrepresentation or omission relied upon by an underwriter or lender to fund, purchase or insure a loan." Basically, it is anything that you or your real estate professional does to misrepresent data in order to secure a mortgage loan.

A lot of people may think that a little white lie here and there is okay when it comes to securing a loan. People may have been told by their real estate agents that it is no big deal. But, the fact is that it is a big deal. Even the tiniest bit of information that you fail to represent in your loan application could end up in the worst situation for you and your family. For one thing, your insurance company could cancel your loan application, then they might sue you, ask you to pay a hefty load of cash and you might even end up in jail for it.

In applying for your mortgage loan, it is truly important for you to write down real information about yourself. These insurance companies are very wise. They usually employ a group of people who would track down those who are trying to dupe them. These housing insurance companies work a lot like those in the health care insurance industry, who do a lot of prying just to find a pre-existing condition you might have had in the past just so that they can cancel your insurance policy. If you really want to have that loan, then it would be best to just tell the truth.

Now, you might think that your real estate agent's length in the business is enough reason for you to believe them. But, actually, you should know who to trust. It does not mean that, if a person has been very successful in the industry, he is automatically reliable. You also have to be wary of the people you are betting your hard-earned cash on. Haven't we all learned from those who trusted Bernie Madoff and all those other rich insurance company CEOs? The truth remains that these companies are in it for the cash (for your cash) and it is wise for you to not give them any reason to take away what's yours.

In order to protect yourself from mortgage fraud, it is important that you immediately report to the FBI anyone you suspect to be part of a fraud scheme. When these mortgage brokers' program sounds too good to be true, then it is highly likely that something wrong is going on. Moreover, you must not forget that mortgage fraud is a prosecutable crime and is against the law. If you suspect that you are being asked to break the law or anything to that end, at the very least, you should meet with a reputable real estate lawyer or the licensing authority in your state before moving forward with your plans. Surely, you would not want to give your money away to someone who will just lead you to jail now, would you?