Residential Mortgage Fraud In The First Degree: New York Penal Law 187.25

Residential Mortgage Fraud in New York: Understanding Fourth Degree Charges and Legal Consequences

The Evolution of Mortgage Laws Post-2008 Financial Crisis

Mortgage laws are strict, and they’re being made even stricter following the economic crash of 2008. Banks and lenders spent too much time, effort, and money issuing loans to residents who could not afford to pay them back, and the laws have become far stricter in an effort to prevent this problem from occurring yet again.

Impact on Homebuyers and Market Access

In light of new laws and restrictions placed on mortgages, many people find that they can no longer afford a mortgage that allows them to purchase the home they want. This means:

• Some people are saving longer
• Looking for more down payment assistance
• Some people are even taking the time to defraud their mortgage lender

Understanding Residential Mortgage Fraud in New York

Residential mortgage fraud in New York does happen. It occurs when someone in need of a mortgage provides false information to a lender in an effort to secure a loan they might not be able to afford.

There are several different types of mortgage fraud broken down by degree. Residential Mortgage Fraud in the Fourth Degree is a serious crime in New York.

Residential Mortgage Fraud in the Fourth Degree

While it’s considered a low-level felony compared to other types of felonies in New York, this is a very serious crime.

Criminal Penalties and Long-Term Consequences

Being charged with this type of felony not only results in many years in jail, it also results in the long-term consequences that affect:

• Your ability to get a job that pays well
• To care for your family
• Even affect your future

Your family might decide to leave, you might not be able to get work in any capacity in the future, and you might lose your home.

Sentencing Guidelines and Criminal Record Impact

When you commit this crime and are convicted of it, you face anywhere from one to four years in prison.

Potential for Early Release

There is always a chance you could:

• Be released on good behavior
• Earn time
• Serve time less than the full sentence for various reasons

However, you will always have a felony conviction on your record and in your background history, which means your entire future is challenged.

What Constitutes Fourth Degree Mortgage Fraud

Now that you know what you might face if you’re caught engaging in residential mortgage fraud in the fourth degree, you must know what it means and how you become involved in a crime like this one.

It’s a simple crime. You provide false information and the documentation to prove it when submitting a mortgage application.

Common Scenarios Where This Crime Occurs

It doesn’t typically happen with an actual mortgage, but it does happen more often with:

• A home equity line of credit
• With a refinance situation

You must receive at least $1,000 but no more than $3,000 from the bank with this kind of false information.

How the Crime is Committed

When you apply for the mortgage and you make false statements that allow you to borrow at least an additional $1,000 but no more than $3,000, you are guilty of this crime.

Real-World Example

It’s possible this lie and this intentional act of defrauding the lender could happen when you buy a home. You add a few dollars to your income so you can borrow a few thousand extra dollars to get the house you want, and you suddenly face criminal charges and a felony arrest.

The Legal Process After Being Caught

If you’re caught doing this, you could be arrested. You’re then:

• Charged with the crime
• Taken to jail
• Released on bail
• You face a hearing

The Importance of Legal Representation

You must call an attorney to help you with this or you face a lot more trouble while the case in ongoing.

Defense Strategies Your Attorney May Use

An attorney can help you argue:

• You didn’t know what you were doing or what you were submitting when you did it
• You could have your attorney help you prove you didn’t realize you were committing a crime
• Perhaps you didn’t understand the instructions on the application

Working with Your Defense Attorney

Your attorney can help you figure out how to defend yourself in a situation like this one, and it might be the way you must go to help your case.

If you’re found guilty, you could go to jail. It’s not worth taking the time to defend yourself with your entire future in question.

When to Seek Legal Help

If you did not commit this crime knowingly, it’s time to hire an attorney. Your attorney can:

• Answer your questions
• Help you understand what’s happening
• Fight for your rights in court

Protecting Your Future: Prevention and Legal Guidance

Residential mortgage fraud in the fourth degree can change your life forever if you’re convicted, which is why you must take the time to avoid this conviction.

Best Practices to Avoid Mortgage Fraud Charges

Submit only information you know to be true, and consult with an attorney if you are arrested for this crime.