Mortgage Fraud


SHORSTEIN, LASNETSKI, & GIHON
helps people defend against
Mortgage Fraud
allegations.

Buying a home can be a confusing and difficult process.  The paperwork shoved in your face with fine print,  generic warnings, and legalese is often in conflict with what you are told by the realtor, mortgage broker or other people.  Much of the information provided is fluid and changing or estimates.  However, with the fall of economy, the government has looked for people to blame.  Unfortunately it is easier to go after individual citizens, than it is to go after the lenders.  Mortgage Fraud is a serious allegation, but there are defenses.  Give us a call.

What is Mortgage Fraud?

Mortgage Fraud is defined in Florida Statute Sections 817.545(2) & (5).  To prove that you committed Mortgage Fraud, the State must prove:
  • You, with the intent to defraud, knowingly,
  • made any material misstatement, misrepresentation, omission during the mortgage lending process with the intent that the misstatement, misrepresentation, or omission, would be relied on by a mortgage lender, a borrower, or any other person or entity involved in the mortgage lending process, or
  • used or facilitated the use of any material misstatement, misrepresentation, or omission during the mortgage lending process with the intent that the material misstatement, misrepresentation, or omission would be relied on by a mortgage lender, a borrower, or any other person or entity involved in the mortgage lending process, or
  • received any proceeds or other funds in connection with the mortgage lending process that he or she knew resulted from the making of any material misstatement, misrepresentation, or omission during the mortgage lending process that was made with the intent that the misstatement, misrepresentation, or omission would be relied on by a mortgage lender, a borrower, or any other person or entity involved in the mortgage lending process, or
  • received any proceeds or other funds in connection with the mortgage lending process that he or she knew resulted from the use of any material misstatement, misrepresentation, or omission during the mortgage lending process that was made with the intent that the material misstatement, misrepresentation, or omission would be relied on by a mortgage lender, a borrower, or any other person or entity involved in the mortgage lending process, or
  • filed or caused to be filed with the clerk of the circuit court for any Florida county a document involved in the mortgage lending process which contained a material misstatement, misrepresentation, or omission. 

What if I just made a mistake on my mortgage application?

Mistakes happen.  Especially in mortgage applications.  It is the State's job to prove that you provided or omitted the information knowing you were doing it and with the intent to deceive someone.  The State can prove this by submitting the application showing what you provided or omitted, and your signature attesting that the information is truthful and then provide documentation that the information is incorrect.  They can also use your own statements, bank records, etc.  So the facts matter.  If you omitted a million dollar debt that you owe, it will be less difficult for the State to prove your knowledge and intent than if you omitted a $150 debt from 4 years ago. 

Also, it is not mortgage fraud to omit information about your employment, income or assets for a loan that doesn't require that information. 

What is the "mortgage lending process?"

  The "mortgage lending process" means the process through which a person seeks or obtains a residential mortgage loan, including, but not limited to,
  • the solicitation, application or origination,
  • negotiation of terms,
  • third-party provider services,
  • underwriting, signing and closing,
  • and funding of the loan.

What documents are considered part of the mortgage lending process?

Include, but not limited to:
  • mortgages
  • deeds
  • surveys
  • inspection reports
  • uniform residential loan applications and other loan applications
  • appraisal reports
  • HUD-1 settlement statements
  • supporting personal documentation for loan applications
    • W-2s,
    • verification of income and employment,
    • credit reports,
    • bank statements,
    • tax returns, and
    • payroll stubs
  • any required disclosures

What does "material" mean?

When talking about a "material misstatement, misrepresentation, or omission,"  the State must prove that the misstatement, misrepresentation, or omission was "material." 

"Material" means a fact a reasonable person would use to decide whether to do or not to do something.  A fact is material if it has the capacity or natural tendency to influence a persona's decision.  Any misrepresentation or concealment must be reasonably calculated to deceive persons of ordinary prudence and comprehension.  

So, if you intentionally omit a fact on a mortgage application that no reasonable person would care about in deciding whether you loan you money, then even though you knowingly left it out, it would not be mortgage fraud.  Whether a fact or omission is material is for a jury to decide. 


What are the potential sentences for mortgage fraud?

Loan value is $100,000 or less
Up to 5 years in prison

Loan Value exceeds $100,000
Up to 15 years in prison


What are the possible defenses to mortgage fraud?

Because the State has to prove what was in your head, a common defense to mortgage fraud is that you did not knowingly try to deceive or defraud anybody.  A common allegation is that you inflated your income or mitigated your debts in order to look like you are more financially stable.  However, often these numbers are estimates and not concrete numbers.  A person's financial structure can be complex.  Another defense is that the fact or omission was not material.  If a reasonable person would have loaned you the money in spite of the omission, then the fact isn't material.  Every case is different.  Give us a call to discuss the possible defenses to your mortgage fraud case. 

If you or a loved one has been arrested for or accused of
Mortgage Fraud,

Call Shorstein, Lasnetski & Gihon Now!

904-642-3332 (Jacksonville)
 
or

407-228-2019
(Orlando). 

Contact Us 24/7 Se habla Español