Mortgage fraud hurts everyone in the housing industry, from the lending institutions all the way to the homeowner. After the housing bubble burst and there was an increase in foreclosures, mortgage fraud schemes increased as well. These scammers poised themselves to take advantage of those struggling with mortgage debt.
Mortgage fraud can take many forms including:
· “Builder-bailout,” where developers discharge excess inventory through financial dishonesty
· Rescue fraud, where homeowners are tricked into signing away the deed to their home
· Identity theft
Stay Alert for Mortgage Fraud
If you are struggling with debt and are looking for help to get back on track with your mortgage, remember these tips to avoid mortgage fraud.
1. Never sign a blank document or a document that has unspecified blanks. Any time you sign a legal document, you want to ensure that all of the terms and conditions are clearly spelled out for both parties. Blanks in the document can be used to change the terms once it’s signed.
2. Use referrals. Trusting referrals from family, friends, or local sources ensures that you’re working with a trusted source that others have had a good experience with. They can help you settle your debt and you won’t have to worry about mortgage fraud.
3. Educate yourself to the types of mortgage fraud. Two of the most common scams are Reverse Mortgage Scams and Loan Modification Scams. If you know the most common types of mortgage fraud in your region, you’ll know to be extra cautious as you approach those opportunities.
It’s important to follow these tips, because becoming a victim of mortgage fraud can incur more debt. Victims lose time, money, and aren’t always guaranteed the opportunity to recuperate what they lost from the scam.