Avoid Being a Victim of Mortgage Fraud

The US Treasury's Financial Crimes Network announced recently that they have seen in increase in filings of suspicious mortgage fraud activity.  A Mortgage Loan Fraud Suspicious Activity Report (MLF SAR) is filed by a mortgage loan company when they find suspicious activity, such as misrepresented income, debts/assets, wrong social security numbers used, debt elimination scams, identity theft and more on loan application reviews.  More than 80% MLF SARs were from loans originating before 2008.  Avoid being a victim of mortgage fraud when buying a / home by following these simple rules:

Do Your Homework - The old adage of "if it's too good to be true, it probably is" still rings true.  Don't crack under high pressure sales tactics.  Thoroughly investigate debt elimination companies as well as mortgage companies before you hand your information over to them.  Also, check out the history of a property to see how often it has been sold in the past few years.  This can be done with a title report.  Find out what other / homes have sold for in the area recently in order to know that the price you are paying is appropriate.  Your real estate agent can help you with this.  Shop around for a lender to compare prices and options.

Be Truthful - You don't want to borrow money you can't repay.  That will just get you into more trouble.  If someone tells you that you need to lie about how much money you make, where your downpayment is coming from, how long you've been employed or anything else on a loan application for a / home in order to be approved, walk away.  Obviously, this is not the loan or company for you.

Be Smart - You would never hand over a blank check to a complete stranger, would you?  Don't ever allow someone to talk you into leaving blanks on an application or to sign something you don't thoroughly understand.  If they won't answer any questions you have or if you still have questions, take these to your trusted financial adviser or other trusted source of financial information to find the answers you need.  You will be held liable for whatever you sign your name to, whether you understood it or not.  So, take the time to go through all documents before you sign them and hand them over.

Be Knowledgeable - Attend seminars, workshops and classes on home buying to become a more informed buyer.  Pull your credit report first to check for errors.  Anything you can do to learn about buying a home before going through the loan process will help make your experience go much more smoothly and without a lot of stress.

Avoid being a victim of mortgage fraud by following these simple steps.  When you're interested in buying a / home, just let me know.

Originally posted on my Northern Virginia homes blog here: http://northernvirginiahomes.net/2011/10/13/avoid-being-a-victim-of-mortgage-fraud/.