Avoiding mortgage fraud

On Behalf of | Jun 27, 2023 | White Collar Crimes |

Mortgage fraud is a broad term. It can include activities such as property flipping, identity theft and foreclosure scams.

In this post, we describe some of the more common types.

How does Missouri law treat mortgage fraud?

According to Missouri law, mortgage fraud is a class D felony, and every transaction violating this section will be treated as a separate offense. Furthermore, each class D felony conviction could result in a prison sentence of up to seven years.

Mortgage fraud is also a federal crime. Federal and state agencies have devoted significant resources in recent years to investigating and prosecuting it.

Can mortgage fraud ever be inadvertent?

Suppose you unknowingly left out pertinent information from your mortgage loan application. In that case, you may have inadvertently crossed the line into criminal activity and it makes sense to talk with a defense attorney about your specific situation.

What are some of the more common types of mortgage fraud?

Submitting fraudulent loan documents is only one form of illegal conduct associated with mortgages. Other types of mortgage fraud include:

  • Property flipping schemes – Someone buys a house at below market rate and immediately turns around and sells it for a hefty profit. Such schemes are illegal when facilitated by corrupt actions such as an appraiser who inflates the true value of the property.
  • Identity theft – Someone gets financing for a house by stealing personal information from a victim, such as Social Security numbers and financial verification information.
  • Money laundering – Someone may try to buy a house using proceeds from criminal activity.

Be mindful of the process

The paperwork to get a mortgage can be very intensive. But to protect yourself from possible legal jeopardy, make sure you look closely at what you’re dong and follow through on all necessary steps.