What do you do when your lender tells you to commit loan fraud?

By
Real Estate Agent with Progressive Realty (Boise Idaho) www.Progressive-Realty.info DB-17066

I believe in full disclosure and absolutely detest being asked by a lender to remove something from a sale that is actually being included trying to fit their requirements into my transaction!

Blind Justice

For example, again today, I had a lender call me up telling me to remove shelving from a real estate purchase and sales contract since their mortgage only deals with real property and since the shelves are not attached, they are personal property.  While they are correct about they "type" of property, I didn't write the contract for the lender, I wrote it to be clear and concise as to what was to be conveyed with the sale.

Our contract states that all personal property included in the sale is of nominal value and considered to be worth less than $100.  I recognize that when a seller includes a washer/dryer or a free stranding fridge or shelving that these do not (and can not) be considered in the valuation on the appraisal of real property.  

This wouldn't be an issue, but how am I supposed to answer the same lenders' Ammendatory Language Clause and Certification?

"Real Estate Certification The seller, the purchaser, and the real estate agent or broker hereby certify that the terms of the sales contract are true to the best of their knowledge and belief and it is agreed that any other agreement entered into by any of the parties is fully disclosed and attached to the sales contract."

In some real estate classes, they say you should just have a side agreement to have a one party garage sale after closing to sell these items between the buyer and the seller, but isn't that still a non-disclosed separate agreement?

 

 

Photo credit to Chris Blakeley via Dirty Martini - Blind Justice  Creative Commons license)

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Tags:
mortgage loan fraud
jim paulson boise realtor
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Rainmaker
1,678,561
Lise Howe
Keller Williams Capital Properties - Washington, DC
Assoc. Broker and Attorney Licensed in DC, MD, VA,

I agree. That can be so annoying and troubling but it is something we all face with one lender or another

Mar 09, 2015 09:05 AM #1
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Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

This falls into the "Don't commit loan fraud unless your lender tells you to," category.    Shelves ultimately are immaterial to the transaction as a whole.  Not really on the same level, say, of doctoring pay stubs.

Mar 09, 2015 09:39 AM #2
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Frank Rubi
Frank Rubi Real Estate, LLC - Metairie, LA
FrankRubiRealEstate.com

I know that I am to pretty to wear the Orange Jump Suit so avoid that type of Loan Officer.

Mar 09, 2015 10:16 AM #3
Rainmaker
2,539,966
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

I'm smiling at Frank Rubi's comment #3.  I don't look good in orange either.  I had my colors done several years ago, and have been told to stick with cooler shades.

Mar 09, 2015 11:35 AM #4
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Anna Banana Kruchten CRB, CRS 602-380-4886
Phoenix Property Shoppe - Phoenix, AZ
Arizona's Top Banana!

Jim Paulson not going to happen.  I had one last week (not my buyer) insist that all I had to do was change this and change that in the contract. Worse yet he thought  I was going to buy his logic and he kept trying to get his way.  He was so far off base and I explained why. It wasn't his call to change an offer because he messed up. Do it the right way - period. Plus I had a feeling he knew about the issue about from the start. Like Frank Rubi, MBA I'm way to pretty to wear orange or be locked up. 

Mar 09, 2015 12:58 PM #5
Rainmaker
3,982,614
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

WE tell the lender to jump off of a building and we find a new lender and FAST!

Mar 09, 2015 01:04 PM #6
Rainmaker
299,380
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

Lise Howe since you are also a licensed Attorney, I am curious if you have found a solution to this other than changing the lender.  This time, it is a national big box lender.

Mar 09, 2015 11:24 PM #7
Rainmaker
299,380
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

Chris Ann Cleland at least if my client doctored their paystubbs, they are the one committing load fraud and I wouldn't have to sign anything taking responsibility for their actions.  However, asking me to create the document that creates the false statement is another matter.  I am shocked that the lender said I didn't need to extract the washer/dryer and fridge because they are "appliances".  Last time I checked, those appliances were personal property too.

Mar 09, 2015 11:28 PM #8
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Rainmaker
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Jim Paulson

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