Commiting loan fraud is a serious infraction of the law. Many who do it are not even aware they ar.committing fraud. This article will provide a couple ways t.commit loan fraud that seem innocent enough.
Loan #1 is on a house purchased at market value.
During the inspection the roof is noted to be in need of repair to the tune of $10,000.
The seller agrees to rebate the $10,000 back to buyer at closing. Nothing illegle so far. How the rebate is written into the contract will determine if any fraud i.committed.
Should the buyer and seller make a side agreement that is based on a handshake they have conspired t.commit fraud.
They could however write the rebate into the contract and present it to the lender. At that point the lender can decide if the $10,000 is a price concession or not. Much of that will depend on the appraisal.
Loan #2 is on a house that has been on the market for a peroid of time and over that time frame the price has been reduced a few times from the original listing amount.
A buyer is eventually found and the purchase price is at or above the original listing price. No frau.commited here unless there are side agreements for money to flow back to either the buyer or the one promoting the fraud.
In this case the mortgag.company may feel they have a good 80% LTV but in reality the buyer could be getting a 100% or more mortgage.
Again if everything is presented properly in a contract and the loa.company goes ahead with the transaction you could be OK.
Chuck Avants
myavants.com/
