Loan application fraud by real estate professionals happens when a mortgage professional (normally a loan officer or broker) who, without the consent or knowledge of a borrower, creates and submits false information to the lender. The scammer does this to increase the chances that a borrower will get a loan approved so that the scammer can collect his commission. The scammer will generally inflate the loan application by including phony bank accounts that have large amounts of cash and false secondary employment.
Loan officer’s that participate in this scam normally do not do this once; if all of his files are audited, it will demonstrate a common practice that he has incorporated into his business of securing loans. As a borrower, it is imperative to review the 1003/ Loan Application to ensure that all information that is being submitted by a mortgage professional, to the lender, reflects truth and accuracy.
Loan Application Fraud