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What is a mortgage fraud charge and how can it affect you?

If you are facing charges of mortgage fraud, you may feel troubled and concerned. Your family home, your assets and your livelihood might be at risk. If you understand how Texas law applies to your situation, you can help your case.

What is mortgage fraud?

Mortgage fraud is a form of Financial Institution Fraud. This type of fraud can damage an individual, a financial institution (such as a bank) or both. Usually this involves providing false information to trick a bank or a money lender. Mortgage fraud is usually done for the following:

  • For profit: In these cases, someone uses their professional experience to pull money from lenders or homeowners into their own pockets.
  • For housing: A person commits an illegal act to buy or keep a house. They might lie about their income or bribe an appraiser to lie about a property's true value.

There are many different schemes people use or invent to trick a bank or money lender. If they are successful, they can convince a bank to do approve a loan, reduce a payoff amount, agree to repayment terms, change a property's value or even force out current homeowners for profit.

If these lenders knew the truth, they would not agree to do business with the culprit.

How can mortgage fraud charge affect you?

Cases of mortgage fraud involve multiple authorities. When mortgage fraud or schemes affect property in multiple states, or generate a significant profit, the FBI may investigate those crimes on a federal level. Your case might also involve the Offices of the Attorney General and Consumer Credit Commissioner, the departments of Insurance, Savings and Mortgage Lending and Housing and Community Affairs just to name a few.

In Texas, you might face the following criminal charges depending on the size of the loan and the value of the property:

  • A third-degree felony if the loan is between $30,00-$150,000
  • A second-degree felony is the loan is between $150,000-$300,000
  • A first-degree felony if the loan is more than $300,000

These come with jail time and large fines. Your legal fees will increase with every government office or department involved.

Mortgage fraud cases quickly become complicated. If you are facing these charges, you may want to explore your legal options.

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