Protect Yourself Against Mortgage Fraud

Posted by Hartanov Team on Saturday, June 13th, 2009 at 4:40am.

Three Orange County businessmen were indicted by a federal grand jury this week accused of mortgage fraud, falsifying W-2 forms and tax evasion. It is always distrubing to hear stories of fraudulent practices, knowing innocent people end up the victims. There will always be those who take advantage of others. The best thing you can do is become an educated consumer and know how to protect yourself against mortgage fraud. Below are 11 Tips On Being A Smart Consumer from HUD.

11 Tips On Being A Smart Consumer

Before you buy a home, attend a homeownership education course offered by the U.S. Department of Housing and Urban Development (HUD)-approved, non-profit counseling agencies.
Get information about the prices of other homes in the neighborhood. Don't be fooled into paying too much.
Hire a properly qualified and licensed home inspector to carefully inspect the property before you are obligated to buy. Determine whether you or the seller is going to be responsible for paying for the repairs. If you have to pay for the repairs, determine whether or not you can afford to make them.
Shop for a lender and compare costs. Be suspicious if anyone tries to steer you to just one lender.
Do NOT let anyone persuade you to make a false statement on your loan application, such as overstating your income, the source of your downpayment, failing to disclose the nature and amount of your debts, or even how long you have been employed. When you apply for a mortgage loan, every piece of information that you submit must be accurate and complete. Lying on a mortgage application is fraud and may result in criminal penalties.
Do NOT let anyone convince you to borrow more money than you know you can afford to repay. If you get behind on your payments, you risk losing your house and all of the money you put into your property.
Never sign a blank document or a document containing blanks. If information is inserted by someone else after you have signed, you may still be bound to the terms of the contract. Insert "N/A" (i.e., not applicable) or cross through any blanks.
Read everything carefully and ask questions. Do not sign anything that you don't understand.
Before signing, have your contract and loan agreement reviewed by an attorney skilled in real estate law, consult with a trusted real estate professional or ask for help from a housing counselor with a HUD-approved agency. If you cannot afford an attorney, take your documents to the HUD-approved housing counseling agency near you to find out if they will review the documents or can refer you to an attorney who will help you for free or at low cost.
Be suspicious when the cost of a home improvement goes up if you don't accept the contractor's financing.
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.

Learn more about buying an Orange County home.

The Hartanov Team is a Professional, Experienced and Results Oriented, Top Orange County Real Estate Team committed to meeting your needs. We use the latest technology to dramatically improve the speed, efficiency and innovative capabilities of every part of the service we deliver. We specialize in offering a new level of service helping people buy and/or sell Orange County area homes, condos, Short Sales, REO and Bank Owned, investment properties and 1031 exchanges, including relocation assistance for buyers who are becoming new residents of the beautiful ocean front region of Orange County. For more infomation about buying or selling your Orange County home, please call us direct at 949.481.3739 or via email at contact The Hartanov Team.

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