03 Aug 23

Real Estate Fraud

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Last Updated on: 4th August 2023, 02:01 pm

An Overview of Real Estate Fraud

Real estate fraud occurs when someone uses false information in order to to take advantage of the other party during a real estate purchase or transaction. The majority of real estate cases revolve around mortgage loan fraud. However, real estate fraud can occur in a variety of ways. It can also occur during the closing, appraisal and drafting stages.

Things That Can be Classified as Real Estate Fraud

Real estate fraud can be placed in one of two categories. It can be classified as lender/professional fraud and borrower fraud. Borrower fraud may include the following.

  • Falsifying information on loan applications
  • Misrepresenting information about the applicant’s credit
  • Omitting pertinent information during the transaction

When a person commits borrower fraud, they are trying to get the title to the property. Professional or lender fraud is committed when a person attempts to gain extra money from a transaction and may include the following.

  • Flipping property and making other transactions that can be considered questionable
  • Engaging in deceptive advertisement
  • Misrepresenting information about credentials and licensing
  • Identity theft

There are several ways that fraud can be committed. However, the person has to intentionally commit fraud in order to be charged with it. A person may make a mistake, but it probably will not be classified as fraud. In some cases, the borrower and lender may work together to commit fraud.

Penalties for Real Estate Fraud

If you are convicted of real estate fraud, then you can face some serious consequences. You may be charged with a criminal fine. You could also spend time in jail. If the fraud case is serious, then you can spend up to 30 years in prison.

You may also be ordered to pay criminal restitution to the victim. The purpose of this is to allow them to recoup their losses.

Defenses for Real Estate Fraud

Procedures Defenses

If the plaintiff did not follow the proper procedure to file a case, then you may be able to get your charges dropped. The case may also be stalled if the proper procedures are not followed. The judge can dismiss a case and give the plaintiff extra time to refile.

There is a Statute of Limitations that applies. If the Statute of Limitations has expired, then the case may be permanently dismissed.

Elemental Defenses

This defense can be used when the plaintiff has trouble providing certain aspects of the fraud. The plaintiff will lose if they cannot prove that the fraud occurred. They will have to be able to prove all of the aspects of the fraud. If you can prove that the plaintiff misrepresented information, then you will be able to win in court.

Damage Defenses

Even if the plaintiff can prove that the fraud occurred, you may still be able to use the damage defense. You can try to convince the court that the plaintiff should not be able to collect as much damages as they are asking for. There are several damages that can be collected from the defendant.

There are actual damages, attorney’s fees and exemplary damage. Exemplary damages are paid to punish the defendant. You may be able to convince the court that you should not have to pay exemplary damages. If you can prove that you did not commit fraud on purpose, then you may be able to get your charges reduced.

Why You Should Hire An Attorney

Because you can face some serious charges if you are charged with real estate fraud, you do not want to go through this alone. You will need the help of a lawyer. Your attorney will be able to provide you with the advice and guidance that you need. Your lawyer will be there to support you throughout the entire case. They can also provide you with legal representation in court.