Mortgage fraud is a crime that is taken very seriously by the real estate industry, the Albertan government, and the police. With that in mind, it is important not to inadvertently participate in mortgage fraud and to actively protect yourself from becoming a victim of it. There are three main types of mortgage fraud in Canada.
Mortgage fraud for housing is when a potential homebuyer provides false, inaccurate, or otherwise omits information on a loan application. This is often to obtain a more expensive property than the lender would otherwise allow them to afford.
Unfortunately, industry insiders can be a part of what is known as mortgage fraud for profit. This can happen in several different ways, some of the most common schemes are convincing investors to buy into a property that doesn’t even exist or having someone with good credit sign for a home on behalf of someone else.
Mortgage fraud for title is effectively identity theft. However, in this case, stealing your identity and the use of fake documents results in a change in the title of your home or leaving you in severe debt. A criminal will achieve this by taking a mortgage out on your home under your name.
The good news is that there are many ways to protect yourself from these criminal activities.
Always ensure all of your information provided for the application is up-to-date and accurate. Don’t be afraid to look over your paperwork and supporting documents a few times over. Even small mistakes can be reported.
Never add your name to someone else’s mortgage unless you’re making payments.
When you make a deposit on a home, ensure it is held in trust by the seller’s realty company or a lawyer. Never pay the seller directly.
Always work with licensed or accredited mortgage and real estate professionals. Brokers should be registered through the Real Estate Council of Alberta (RECA).
Regularly check the title on your home and your credit rating. Report any suspicious activity.
Protect your personal information such as your SIN number.
Mortgage fraud is entirely preventable. Start by working with a licensed mortgage broker. For experienced brokers in Red Deer and surrounding areas, trust the experts at Source Mortgage. We can help set you up with a mortgage without the fear of fraud. Contact us for a consultation!
Source was absolutely great to work with - went above and beyond to help us get everything done when buying our new home. Highly recommended!! Chad and Jenelle Richards Jan 09 2013
Chad and Jenelle Richards
Added January 23rd 2013
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