As home prices in Texas continue to rise, so does the desire to own a home. Many Texans want to own a house before the home prices get too expensive and out of their reach. That’s understandable. Unfortunately, as more mortgages are being issued, law enforcement is also seeing an increase in mortgage fraud.
What exactly is mortgage fraud in Texas and what is the penalty for being arrested for mortgage fraud? Keep reading to see how a bail bond agent in Fort Worth, Texas can help you if you’ve been arrested.
Understanding Mortgage Fraud in Texas
To understand mortgage fraud, you first need to understand what a mortgage is. A mortgage is a loan that a homeowner takes out from a lender (bank and/or other financial institutions) in order to buy their house or an investment property.
To get a mortgage, you need to prove to the lender that you have a stable income, good credit, and you won’t default on the loan that you are taking out. Usually, you’ll need to provide documents to prove you are in a good financial position and are who you say you are.
Mortgage fraud is when the parties involved in the mortgage process (buyer, seller, underwriter, mortgage broker/agents, appraiser, and others) provide false information to defraud the lender to obtain a mortgage.
Mortgage fraud in Texas and other money laundering fraud is a serious crime. You could incur hefty fines and restitution of damages occurred at financial institutions, as well as serve several years (or decades) in jail.
Examples of Mortgage Fraud
There are two main categories of mortgage fraud in Texas: fraud for profit and fraud for housing.
Mortgage fraud for profit is usually committed by those with insider knowledge in the mortgage market or those who stand to profit from the mortgage transaction (e.g., brokers/agents, underwriters, appraisers, etc.).
Mortgage fraud for housing is primarily done by homeowners. It could be as simple as providing false information or forging false documents to quality for a mortgage.
Here are a few examples of mortgage fraud in Texas. Keep in mind that these are just a few examples. Mortgage fraud in Texas comes in many forms.
Income Fraud
As the name suggests, income fraud in Texas is when a perspective homeowner knows their credit is bad and their employment income isn’t sufficient enough to qualify for a mortgage, so they forge pay stubs and make up an income in order to qualify.
Occupancy Fraud
Usually when it comes to getting a mortgage for an income/rental property (or an investment property where the main goal is to generate income), mortgage lenders will require a higher down payment and offer higher interest rates. Why? Because there’s a higher risk involved in getting a mortgage for an income/rental property.
If the borrower claims that they will be living at the property in order to get lower mortgage rates—even though the won’t—they are committing occupancy mortgage fraud.
Appraisal Fraud
This kind of mortgage fraud may involve two parties: the seller and the appraiser. The idea behind this mortgage fraud in Texas is quite simple: the appraiser may appraise the value of the property at an above-average price and give the seller a chance to sell at immense profit. Then, both the seller and the appraiser split the profits later.
Nominee Fraud
When a buyer with poor credit (who wouldn’t normally qualify for a mortgage) asks a friend or family member to take on the mortgage in their name and then the buyer pays the friend/family member a monthly mortgage payment, this is called nominee fraud.
Can You Get Arrested for Mortgage Fraud in Texas?
It can’t be stressed enough: mortgage fraud in Texas is taken very seriously. Yes, you could get arrested for committing mortgage fraud.
According to 18 U.S.C. § 1014, if you are convicted, you could get a maximum sentence of 30 years in federal prison and up to $1.0 million in fines, or a combination of both. So, in simple words: a person convicted of mortgage fraud in Texas could spend a major portion of their lives behind bars.
Keep in mind that if convicted, and in addition to the fines imposed by the judge, one could also be responsible for damages occurred due to mortgage fraud in Texas. This could be detrimental, considering how mortgages are generally large denominations.
How a Bail Bondsman Can Help
If you or your loved ones are arrested for mortgage fraud in Texas, a bail bondsman can help in getting you out of jail fast. No one wants to spend more time than they need to behind bars. Getting out of jail quickly can ensure that you have the time and resources to build a proper defense and hire a reputable attorney.
At PCS Bail Bonds, we know that people make mistakes. We have been in business since 1991 and offer fast and affordable bail bonds in Tarrant County for a multitude of offenses, such as assault, hit-and-runs, burglary, embezzlement, and mortgage fraud to name a few.
We have professional memberships in several renowned associations including the Professional Bondsmen of Texas, Tarrant County Bar Association, and Professional Bondsmen of Tarrant County. If you’re concerned about the expense, you should know we post affordable bail bonds, offering rates that are 10% lower than our competitors.
Contact us now by phone at 817-335-1655, at our e-mail, visit in-person, or fill out our bail bond request form. Our experts are dedicated to helping you. We are on call and ready to serve. Also, Se Habla Español.