NYC Mortgage Fraud Lawyer

What Are Mortgage Fraud Charges In New York?

Mortgage fraud is characterized by a material misstatement, misrepresentation, or omission relating to a mortgage loan which is relied upon by the lender in deciding upon the approval and/or terms of the loan or its satisfaction.  Any deliberate lie or fraudulent information or document which could be expected to impact upon a lender’s decision will constitute mortgage fraud — although the fraud will be charged as a violation of the bank fraud, mail, or wire fraud statutes.

Federal investigators divide mortgage fraud into two distinct types: mortgage fraud committed for-profit and mortgage fraud committed for the purpose of acquiring housing.  As to mortgage fraud for profit, this typically will involve real estate professionals misusing the mortgage lending process to steal cash and equity from lenders and homeowners.  Most often, it involves schemes in which bank officers, appraisers, mortgage brokers, real estate lawyers, and others are involved.  Mortgage fraud for housing typically occurs when a borrower commits one or more fraudulent acts in order to acquire or to maintain ownership of a home.   This may involve misrepresentations regarding assets, income, sources of down payment, or employment.        

The following are some examples of conduct that may constitute mortgage fraud: mortgage application fraud; employment fraud; mortgage occupancy fraud; foreclosure fraud (foreclosure rescue schemes, equity stripping schemes, title fraud); illegal property flipping schemes; builder bailout schemes; mortgage broker fraud schemes; reverse mortgage fraud schemes; straw buyer fraud schemes; appraisal fraud scheme; commercial loan schemes. 

Sentencing for Mortgage Fraud

As noted, because mortgage fraud is but a species of bank fraud, that statute — along with any other that the person was also convicted of violating — will determine the sentence imposed.  For bank fraud, the maximum sentence is thirty (30) years in federal prison.  However, like all federal felonies, the sentencing court will have to consider the advisory United States Sentencing Guidelines in order to arrive at an appropriate sentence.   In cases involving fraud, the primary driver of the guideline sentence suggested will be the amount of “loss” caused to the lender as a result of the defendant’s fraudulent activity.    Also to be considered as factors under the guidelines are such things as the number of victims, whether sophisticated means were used to commit the crime, whether the defendant held a position of skill or trust, his or her role in the overall offense, and other factors.  The court will then consider all mitigating evidence presented by counsel, including letters from friends and family, concerning the defendant’s background and character in settling upon a just sentence.