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Mortgage fraud could result in criminal charges

On Behalf of | Jun 6, 2022 | White Collar Crimes

Purchasing a home in California often hinges on a mortgage application approval. Would-be borrowers are not always the only ones worried about the approval. Lenders need to issue mortgages to generate profits through monthly payments with interest. Concerns about giving or receiving loans could lead some parties to act dishonestly, opening doors to mortgage fraud accusations.

Mortgage fraud and legal troubles

Mortgage fraud, along with other forms of fraud, involves deception or misrepresentation intending to procure a benefit. Presumably, the benefit would not be gainable without the fraudulent behavior. For example, someone who outright lies about income and assets to receive a mortgage could face fraud charges.

The borrower is not the only person who could face mortgage fraud charges. Anyone involved with the mortgage doing something illegal may get into legal trouble. An unethical appraiser and lender working together to under or overvalue a property might engage in fraud.

Dealing with fraud-related criminal charges

Like any criminal charge, mortgage fraud requires guilt beyond a reasonable doubt for a conviction. Sometimes, investigators might suspect fraud, and a prosecutor could bring charges. However, a jury may not feel convinced about the defendant’s guilt. Perhaps accusations that someone overstated income are dubious. The individual may deal with fluctuating income and assumed higher revenues, so the mortgage application indicated such speculation. A jury might not believe such a case involves fraud.

Under the Constitution, anyone suspected of a crime deserves due process and protection from illegal searches. When law enforcement engages in illegal searches or other unethical behavior, such as witness coercion, any procured evidence could be illegal and inadmissible in court. Prosecuting a case without sufficient evidence might prove impossible. In cases where evidence is overwhelming, a plea bargain deal could be preferable for the defendant.