Mortgage fraud may continue to plague the real estate industry. Maybe, I am seeing only the 20% Fraud for Property/Housing, as defined by The Federal Bureau of Investigations.
Reasons why mortgage fraud may continue:
1) The escalating cost of housing and the “American Dream” of owning your own home.
2) Licensing for real estate agents and mortgage brokers is much too easy. The requirements for licensing need to require a greater level of education, more than a high school degree as a prerequisite for licensing and harder licensing requirements, such as more pre-licensing education and harder tests. This will result in better people and less people entering the real estate profession.
3) Lenders need to offer less loan programs, for example, stated income loans (some refer to this as inflated income loans) and no doc (no documentation loans).
4) Most lenders require an IRS (Internal Revenue Service) Form 4506 at time of closing. Now, there is something that an underwriter or lender can request information and stop an inflated (a.k.a. stated) income mortgage application dead in its tracks. If they lie on their income tax return, is it...
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