If you’re getting a mortgage then you need to know how to protect yourself from mortgage fraud. Mortgage Fraud is using false information to apply for a mortgage or close a loan. There are several types of this but the most common are:

  1. Fraud For Shelter – typically used by a person who wants to buy a home who does not qualify for a specific home purchase and comes up with fabricated job letters, notice of assessments and other illegal documents because they want to get to the housing market even though they don’t qualify for it.
  2. Fraud For Profit – also known as “industry insider fraud”, is the most costly type of fraud. These schemes often involve a group of people who play multiple roles in the fraud. The initiators often receive a larger percentage of the profit while others may be paid several thousand dollars for their part in the misrepresentation.


This is the reason why lenders are very tight with their guidelines. The next time you apply for a mortgage, note that the regulations and guidelines are there to protect not only you as a consumer but also the lenders, investors and banks. Mortgage Fraud has serious consequences. It can stop your mortgage application. It can hurt your credit and can even lead to prosecution and fines. Fortunately, you can avoid mortgage fraud with common sense.

  1. Be Honest – be honest with your mortgage application. Don’t allow anyone to provide false information they say will help you get a loan approved or make the process faster.
  2. Ask Questions – always ask questions if you don’t understand the document. Don’t sign anything when applying for a loan or closing a mortgage unless all blank spaces are filled with information you know is true.
  3. When In Doubt, Timeout – get legal advice and call your state’s banking regulator.

If you are planning to buy or sell a home, let The Incorvaia Team make the process as easy as possible for you. Call us at 440-879-7130 today!