What is mortgage fraud?
Mortgage fraud is the intentional manipulation of personal and/or financial information by an individual to qualify for a mortgage or to assist another individual to obtain a mortgage, that would otherwise not have been approved or been approved for a lesser amount. Mortgage fraud includes the attempt to defraud a lender even if the lender did not approve or fund the mortgage.
You are committing mortgage fraud if you:
- Provide false or misleading information to obtain a mortgage
- Omit relevant information in order to obtain a mortgage
- Provide false or misleading documentation to obtain a mortgage
- Alter true and correct documentation in order to obtain a mortgage
- Collude with another to use your information to obtain a mortgage for them or someone else
- Fail to report a change in your personal circumstances after a mortgage loan application has been made and prior to the mortgage being funded
Mortgage fraud is a criminal offence and may result in:
- Serious legal actions by the lender and the mortgage insurer
- Inability to declare bankruptcy if subject to a judgement resulting from fraud
- Significant downgrading of your credit history
- A maximum of 14 years imprisonment for each fraud case
- Higher mortgage costs and insurance fee for all borrowers
- Increased activity by organized criminals in the community
- Deterioration of housing in the affected communities
Mortgage brokerage professionals help to prevent fraud by:
- Receiving mortgage fraud detection and prevention training
- Explaining to you what mortgage fraud is and answering your questions
- Explaining to you the consequences of mortgage fraud on you and the community
Note: When a mortgage brokerage professional represents you, if you have been candid about your circumstances, they can provide you with options, advocate for you to obtain a mortgage loan lawfully, and give you confidential advice.