Mortgage Fraud

[realestate_help]

What are the implications in relation to mortgage fraud when the borrower submits a residential loan application (1003) in Virginia stating they have three rental properties generating monthly profits when the fact is all three properties are not rented?

The borrower in this case also provided the lender with fake leases using his actual friends as renters as back up documentation for his primary loan. The borrower was not able to qualify for the mortgage if the properties were not listed as rented.

What can the lender do in this case?
Who is at fault for providing the fake information? The borrower for creating the document? What about his friends for providing there names to serve as renters when the lender called to complete the Verification of Rent.

[HUD-1]

From the FNMA 1003

Certification: I/We certify that the information provided in this application is true and correct as of the date set forth opposite my/our signature (acknowledgment indicated below) on this application and acknowledge my/our understanding that any intentional or negligent misrepresentation(s) of the information contained in this application may result in civil liability and/or criminal penalties including, but not limited to, fine or imprisonment or both under the provisions of title 18, United States Code, Section 1001, et seq. and liability for monetary damages to the Lender, its agents, successors and assigns, insurers and any other person who may suffer any loss due to reliance upon any misrepresentation which I/we made on this application.

[HomeGuru]

Originally Posted by realestate_help

What are the implications in relation to mortgage fraud when the borrower submits a residential loan application (1003) in Virginia stating they have three rental properties generating monthly profits when the fact is all three properties are not rented?

The borrower in this case also provided the lender with fake leases using his actual friends as renters as back up documentation for his primary loan. The borrower was not able to qualify for the mortgage if the properties were not listed as rented.

What can the lender do in this case?
Who is at fault for providing the fake information? The borrower for creating the document? What about his friends for providing there names to serve as renters when the lender called to complete the Verification of Rent.

**A: read the bottom of the 1003. Fines and imprisonment are options.