The crime of mortgage fraud has developed quite a bit in this country over the past few years. Sometimes called real estate fraud, this type of crime is wreaking havoc across the country as perpetrators get better and better at it and their methods develop and have become quite complex. Two distinct types of mortgage fraud have arisen to take the forefront of this disgusting practice. Let's have a closer look at the two major types of mortgage fraud and how they operate, perhaps in knowing about them you will be better able to arm and protect yourself against their occurrence.
The first type of fraud that we will look at involved the falsifying of information in order to illegally procure mortgage funds. Typically one person will apply for mortgage funding for a home that is purposely listed at an exorbitant price. In this kind of scenario they home has already been purchased by an accomplice at a lower price. Once the transaction is complete the borrower and the seller disappear with the difference in funds and this leaves the lender stuck with a low priced home that is not worth what it was said to be.
Title fraud is the other common form of fraud currently being perpetrated at a notable rate. This kind of fraud concerns home owners more as usually what is done is criminals used forged and stolen documents to assume the identity of a home owner and then borrows money against the home's equity. This is typically done only to those with good credit and if done correctly can leave a home owner with little to no equity in their home.
This kind of property crime is on the rise as it is so often only discovered after the crime is complete and those involved are long gone. It seems that current financial practices can easily cover up any paper trail long enough to allow the perpetrators to abscond. For this reason, mortgage related crimes have drastically risen in the past years. What does this mean to the average borrower? Increased rates for borrowing for one thing. Sure precautions can be laid out to try to prevent this kind of crime but it is the average borrower that will end up paying for these precautions. And, as stated before it is hard to prevent something that is usually not found until long after it has been done.
Jim Olenbush is a broker and Realtor that is proud to assist home buyers and home sellers with the world of Austin real estate. Jim is a top producer and an expert on the Greater Austin area. For more information on real estate in Greater Austin Contact Jim today or visit his site at www.jimolenbush.com
