How some sellers defraud lenders in today's market
Q: I have a buyer for my house, but she has nothing to put down. Is there a way for me to hypothetically put the down payment for her? I'd increase the selling price by 10 percent and she could finance the rest. I would get my original sales price. Can I order myself a cashier's check for proof of deposit of the earnest money for her lender? That would show that she put down the 10 percent.
A: The short answer is you can't do it this way. The reason lenders want to see evidence of the down payment or earnest money for the purchase of a home is to see that the buyer has some investment in the home. In the past lenders would finance 100 percent of the purchase price. These days 100 percent financing is very hard to get.
What you are trying to do would amount to a fraud on the lender. You would try to deceive the lender into believing that your buyer had put down money that she had not. Then you would participate in the fraud when the buyer applied for a 90 percent mortgage on your home when in fact the mortgage amount would be for the full purchase price of the home.
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Even with all the news on FRAUD they STILL want to do it!
7 posts • Page 1 of 1
Even with all the news on FRAUD they STILL want to do it!
by Otis on Tue Jul 08, 2008 8:21 am
http://www.mortgage101.com:80/partner-s ... nnews57425
Don't believe everything you think 
What are they SMOKING?<<Link
What are they SMOKING?<<Link
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Otis - Certified Residential
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by Steve Owen on Tue Jul 08, 2008 10:44 am
They still want to do it and always will. Real Estate fraud is probably as old as Cain and Able. Why do people steal from banks? Because that's where the money is.
I haven't a particle of confidence in a man who has no redeeming petty vices.
- Mark Twain, a Biography
- Mark Twain, a Biography
- Steve Owen
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by tel on Tue Jul 08, 2008 2:26 pm
Steve, you are dead on accurate.
Not everyone should be buying a house. This is a case of a greedy seller who does not mind ripping off the bank. Why didn't the REagent qualify the buyer first? The agent just wasted eveyone's time by not doing his/her job.
Not everyone should be buying a house. This is a case of a greedy seller who does not mind ripping off the bank. Why didn't the REagent qualify the buyer first? The agent just wasted eveyone's time by not doing his/her job.
Don't be a 2 bit appraiser, or soon we will all be 1 bit appraisers. 4 bits or bust.
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tel - Certified Residential
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by Jim Plante on Tue Jul 08, 2008 2:46 pm
And if the damned appraiser had done HIS job, the other crooks couldn't make a nickel.
Jim Plante
- Jim Plante
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by Steve Owen on Tue Jul 08, 2008 11:07 pm
Jim Plante wrote:And if the damned appraiser had done HIS job, the other crooks couldn't make a nickel.
That's a fact! At least for those types of fruad where an appraiser is involved.
I haven't a particle of confidence in a man who has no redeeming petty vices.
- Mark Twain, a Biography
- Mark Twain, a Biography
- Steve Owen
- Certified General
- Posts: 2136
- Joined: Tue Aug 14, 2007 12:26 pm
- Location: Joplin, Missouri
by WM on Wed Jul 09, 2008 7:27 am
I am STILL seeing houses here appraise for at or even over the last listing price when DOM is +6 months.
No way in my market anyone is paying over list unless it is a REO "excitement" price. Even those are only a few thousand over the list.
Remove the target.
No way in my market anyone is paying over list unless it is a REO "excitement" price. Even those are only a few thousand over the list.
Remove the target.
- WM
- Certified Residential
- Posts: 441
- Joined: Sat Aug 11, 2007 2:39 pm
- Location: Florida
7 posts • Page 1 of 1
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