The market is full of criminal activities in all sectors. The mortgage crimes and fraudulent activities are increasing a lot. Mortgage fraud takes place when the con artists find people struggling with their mortgage payments or are in hurry to sell their homes off. These things can only be avoided if you deal with known and reputed companies and organizations. There are other steps to deal with your mortgage payments rather than going for foreclosure. But there are certain fraud scams that take place and ruin you financially.
Important and devious mortgage scams to be aware of
There are many ways you can be scammed if you’re not careful. You must take careful steps or ask an expert when you’re dealing with a mortgage lender. Take a look at the mortgage crimes you must avoid:
1. Excess pricing
If you see that the purchase price of the house is too high to be bought, don’t go for it. If you ask any other lender about the price and get the minimum one, then the previous lender was trying to scam you. Before you go along with any home buying, you must consult with your agent so that he can get all the required information from the lenders about the price and other details. Always deal with experts so that you don’t fall into any sort of scams.
2. Undisclosed items
If you’re charged extra amount for the home by the seller which is not put in any documents, it’s a clear case of mortgage crime. Have everything on your purchase documents so that you know the amount of money you’re paying and the use of that money. If you strike a new deal with the home seller to give him an amount of money which is not written in the documents and even the lender doesn’t have any knowledge about, it’s one of the mortgage crimes.
3. Unknown second mortgage
Not only sellers and lenders, but also borrowers can commit mortgage fraud. If a borrower is not asked for a down payment, he can commit the crime by borrowing the down payment from the seller and in exchange giving him an unknown and silent second mortgage. This is hidden and unrecorded and the lender is unknown about the whole thing.
4. Lying on application
If you’re a buyer and want to take out a mortgage to buy the property, you need to give your details in an application form. But if you give wrong information or lie on your form, then also you’re committing a mortgage fraud. You need to write everything about your salary and other important details. If you keep things away from your lender, you’re committing mortgage fraud.
These are the 4 different types of mortgage fraud you commit if you undisclosed things from your lender. These things will help you understand how a mortgage crime takes place and prevent it. You may also get involved in mortgage crimes without any fault of yours. But if you take help of experts and disclose everything, you can easily get out of these situations.