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White Collar Crime: Loan Fraud - Let's Negotiate....

By Randy "Lazarus" McAtee

Real Estate Broker/Owner with Lazarus Realty

October 24, 2007 08:00 AM

...its the path of least resistance.

In my opinion the Federal Government and the loan industry would rather renegotiate all the funny money loans done over the last several years rather than investigate them -- because if they did investigate they would find so many perpetrators of fraud our prisons couldnt hold them all.

DON'T LIE ON YOUR LOAN APPLICATION

A broker called me this morning and asked me about doing a loan for guy he knows. He recently sold two homes to this guy's mother and now this guy would like my broker/friend to help him refinance his house. He already has two homes financed under the auspices of being the owner/occupant and he wants to refinance another one as Owner/Occupant to get a lower rate.

The broker who did the other two loans for him tells him this is NO PROBLEM. However this guy would like my broker/friend (who sold his mom the two homes) to do the loan for him. My friend asked my advice.

I told him its OK to say that he is going to occupy the property -even though he isn't - so long as he and client are willing to go to prison.

If you need to finance or refinance don't even think about making false statements on your loan application. Read the following: Don't Be A Victim Of Loan Fraud

11. Be honest about your intention to occupy the house. Stating that you plan to live there when, in fact, you are not (because you intend to rent the house to someone else or fix it up and resell it) violates federal law and is a crime.

© Randy "Lazarus" McAtee 2007
Owner/Broker - Lazarus Realty
aka - Blogging Broker

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Aventura | Bal Harbour | Sunny Isles Beach | REALTOR® 786-229-7999

SIB REALTY, Llc // WaterWayRealty.com - Sunny Isles, FL

lying is wrong no matter what!

Oct 24, 2007 08:09 AM

Randy "Lazarus" McAtee

Lazarus Realty - Fresno, CA

Owner/Broker, Lazarus Realty, Fresno California

Yes - but not all lies can land you in prison. LYING ON YOUR LOAN APPLICATION CAN

I can lie to my wife - she cant put me in prison. (but she might bar the doors to paradise)

Oct 24, 2007 08:12 AM

Jacqulyn Richey

Prominent Realty Group - Las Vegas, NV

Las Vegas Real Estate

I think you are right about the amount of people that would be in prison Randy. Sad, but very true. I think the current administration would rather just sweep it under the rug than actually find out what happened so it could be prevented in the future. -Charles

Oct 24, 2007 08:16 AM

Lania DeMers

Rocky Mountain Realty Co. - Colorado Springs, CO

Broker, Rocky Mountain Realty Co.

Good Post Randy! Maybe you can explain what I've always wanted to understand, but no lender could tell me...how is it legal to do a "stated" income loan when you know that the person wouldn't have to go "stated' if they made enough money to go full doc?

Oct 24, 2007 08:22 AM

Lania - lmao... EXACTLY

i had a guy wanted me to refi his house stated income. reason he wanted to get a loan was his business is tied to the houseing industry and he wanted to tap equity in home to stay afloat.

i didnt do the loan - Country Wide did ... lol. they will probably get the house too!

Oct 24, 2007 08:26 AM

Esko Kiuru

Bethesda, MD

Randy,

Fraudulent activity in the industry was pretty widespread in the go-go years when rising values kept everybody happy. Now that the bubble has burst, the shenanigans are exposed. However, there was so much of it that it's impossible to go after most of the perpetrators.

Esko --- where would we put them?

hey -- here's an idea. JUST DONT ALLOW THEM TO USE A COMPUTER!

Oct 24, 2007 08:28 AM

Anonymous

Marla

If you want to find the biggest real estate fraud operation in the history of CA - just follow Mayor Alan Autry's so-called "citywide upgrade." Residents of Fresno are being annihilated in order to replace sewer/water lines without authorization, permits or inspections. That is how property is being vacated in order to pull this off - eliminating people. Trail of ID theft, forged deeds, altered legal documents, suspected homicide as Autry's key man behind this laughs, "You can't live for the dead." Property is then haphazardly patched back together and sold as "original" on new deeds that entail illegally revised property lines. Mayor Autry has the audacity to say that this operation is helping to lower the crime rate in Fresno. Thanks, pal. Tell that to my dead family members, my dead neighbors, and all the others who are dead as a result of this barbaric operation - all linked to the same mob. Not only taking what others worked lifetimes for but in some cases, even their identities.

Jul 18, 2008 03:30 PM

White Collar Crime: Loan Fraud - Let's Negotiate....

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