What is mortgage fraud
This is when one fraudulently takes out a mortgage for the financial benefit of the borrower or dishonestly making changes to an existing mortgage, such as borrowing further funds. This may include Fraud by:
- False Representation
- Failing to Disclose Information
- Abuse of Position
- and Conspiracy to Defraud
Types of mortgage fraud
There are two types of mortgage fraud. The first is general or domestic mortgage fraud and the second is large scale fraud.
General mortgage fraud .
This is when someone lies on their mortgage application in the belief that this will qualify them for a loan they would otherwise not be eligible for. This kind of fraud is usually committed by individual home purchasers for their own benefit. Typically they provide false information in order to obtain a mortgage.
Conspiracy/large scale mortgage fraud
This often involves more than one mortgage application, and/or multiple properties. It may involve more offences than giving false information in order to obtain a mortgage. It is usually part of a planned criminal enterprise. For example organised criminal groups may use this method for laundering money.
This is viewed as the more serious crime and usually results in a custodial sentence.
Professional service providers can be prosecuted for mortgage fraud
A mortgage application involves many people, not just the applicant. There can be solicitors, surveyors, mortgage brokers, financial advisors, estate agents, property developers and other professionals involved.
Each professional is expected to exercise due diligence and is liable to prosecution if they do not.
A defence of due diligence can be complex and involve a trail of evidence including documents and emails. It is vitally important that an experienced lawyer carries out such a defence. This is because prosecutors may miss important evidence that can have a significant effect on the outcome.
Adam Law Solicitors are highly experienced criminal defence lawyers in all types of fraud. So we know what evidence matters. We know how to mount the most effective defence. Early intervention is very important to the potential outcome. So if you are a professional and think you are liable to prosecution for mortgage fraud please contact us as soon as you can.
falsifying information on mortgage application
Here are some of the things you should never lie about:
- Your income
- Your marital status
- Financial commitments
- The source of your deposit
- Who will live at the property
- Your employment history
- Who is borrowing the money, and who is making the repayments
Please note this is not an complete list. So you must not take it as legal guidance. It is only an illustration of the kinds of lies people often make. Therefore the only safe way to avoid the risk of prosecution for lying on a mortgage application is to be completely honest.
What happens if you lie on a mortgage application?
The least serious thing likely to happen is that you will get a mortgage loan. The more serious outcome is that you will be charged with a criminal offence of mortgage fraud. This offence can carry a custodial sentence.
You also may face the prospect of losing the home if you have got the mortgage and are living in the home.
What is the penalty for lying on a mortgage application in the UK?
The penalty will reflect the seriousness of the crime. Therefore it will be influenced by such factors as;
- The amount of harm caused to the victim
- The amount of money defrauded
- The alleged role the defendant played in the fraud
- Aggravating factors (e.g. concealment or destruction of evidence)
- Previous convictions
- Any other charges, such has money laundering
Lying on a mortgage application is a criminal offence. So it can lead to a maximum prison sentence of up to 10 years. Other penalties can include community service, fines, and seizure of assets. If you plead guilty you may get a reduced sentence.
What to do if you are charged with lying on mortgage application
You should seek expert legal advice immediately. Adam Law Solicitors are specialists in criminal defence and specialise in all aspects of fraud. Contact us now for an expert review of your situation.