Be Mindful of Mortgage Lending Scams and Foreclosure Abuse 

Homeowners and their lawyers involved in foreclosures should be on the lookout for fraud and abuse during the loan process. They should be ready to spot these potential problems.  In Florida, if someone knowingly and intentionally lies or omits important information during the mortgage process, they can be charged with mortgage fraud. This includes using or encouraging others to use these lies to trick a mortgage lender, borrower, or anyone else involved.

But here’s the catch: omissions on a loan application about employment, income, or assets that aren’t needed for the loan aren’t considered serious enough to be considered fraud.

Also, if someone gets money from the mortgage process that they know came from breaking the rules, they can be charged with mortgage fraud.  Lastly, if someone files a document about the mortgage process with the county clerk that has a serious mistake or lie, they can be charged with mortgage fraud.

Mortgage fraud can happen in many ways. It can involve giving loans to people who don’t qualify or hiding how many loans have been defaulted on. Title companies that handle reverse mortgages and don’t send the money back to the mortgagee might also be guilty of fraud or foreclosure scams. Other things that could be wrong and hurt both borrowers and lenders include:

• Taking out multiple loans
• Making deposits bigger than they are and getting a second mortgage
• Stealing someone’s identity
• Using a fake buyer to get a mortgage and buy a house
• Lying on a loan application or giving fake documents to prove income or assets
• Giving fake Social Security numbers
• Changing documents and signing them with someone else’s name
• Making appraisals higher than they really are
• Hiding money
• Providing certain “foreclosure rescue” services
• Misrepresenting occupancy
• Falsifying credit history
• Misleading customers with false information
• Obtaining illegal rewards
• Stealing closing funds

Take Action

F.S. 501.1377 is a law that helps homeowners who are behind on their mortgage payments. It protects them from being tricked or taken advantage of by companies that try to buy their homes or help them avoid foreclosure. The law also requires these companies to provide clear and honest information to homeowners so they can make good decisions. If you think someone is trying to scam you or abuse the foreclosure process, you can report it to the Florida Attorney General’s Mortgage Fraud Task Force by calling 1-866-9-NO-SCAM (1-866-966-7226). 

Lauderdale-by-the-Sea Foreclosure Defense Lawyer

Fight Back. When it comes to foreclosure defense, hiring an experienced attorney is a big decision. Andrew J. Pascale, a foreclosure defense lawyer in the Lauderdale-by-the-Sea area, can give you valuable insights and advice. Give Andrew a call at 877-667-1211 to chat about your case. Just remember, this blog isn’t legal advice, and it’s just here to show you what’s possible.