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Tips for Caution against Real Estate Frauds Helpful Information for Home Buyers

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By : Rose B    99 or more times read
Real estate fraud is one unwelcome and yet inevitable component in the fast-growing real estate industry. There are several information and truth about this fraudulent activity that home buyers ought to know and understand. If you are basically aiming to make a viable and productive investment, it helps to start right and in a legitimate manner. Bear in mind that frauds in this sector are primarily a must in order to avoid expensive fines and chances of getting imprisoned.

Frauds and scams in real estate are technically defined as illegal activities particularly in using false and inaccurate information in gaining a mortgage loan during the process of loan application. There are also fraudulent activities that often referred to any illegal misrepresentation of information and documents that are related to real estate and the transfer of money in the transaction processes.

This type of illegitimate resort is also referred to as mortgage fraud because the scam usually occurs during the application of potential home buyers in securing a home equity loan. This is because technically, the illegal activity starts in the provision of information and other salient details required in qualifying for a home loan. According to the Internal Revenue Service or IRS in the United States, there are several classifications of real estate scams in relation to mortgage application and approval.

One type of home equity loan scam is done through the settlement statements of the prospective property that needed to be financed. The home buyer is oftentimes doing this by intent which is basically for the purpose of gaining more money or loan amount than what is originally asked for. This is done through providing the home seller an accurate statement which indicates the right amount of the selling price of the property. However, the scam is in providing a false statement to the lender which indicates an exaggeratedly larger amount compared to the asking price that the home seller agrees with.

Another very common scheme which is oftentimes committed by home buyers is through giving incorrect information for their mortgage loan approval and eligibility. It is very common that they provide wrong information especially regarding their credit report and employment history. Since these details are quite salient and influential in the approval of your home equity loan, most buyers or applicants resort into falsifying these documents only to secure their much-needed mortgage loan.

What is most unfortunate about this scheme is that most home buyers or applicants are accompanied and persuaded by their real estate agent to give erroneous documents and requirements. The fabrication of their employment history and credit records are quite blatant misrepresentation and offensive to the law that are needed to be remedied as soon as possible. However, there are also subtle frauds that even well-intentioned home buyers may commit especially if they are not very familiar with the real property laws and regulations.

Real estate fraud and illegal activities are predatory offenses that mislead most home buyers into taking a much easier road without realizing the consequences of their illegal actions. For a sure-fire investment, always opt for what is right and in accordance to the law no matter what the cost.
For more information, tricks and tips when it comes to home improvement and real estate as a whole, simply visit Aviano Real Estate, New River AZ Short Sale Realty for Sale and 3 Bedroom Real Estate in Wittmann AZ.

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