Finance
What is 'mortgage fraud' and what are common forms seen in Nevada?
AA minor mistake on a loan application
BIntentional misrepresentation to a lender for the purpose of obtaining a mortgage, including inflated appraisals, straw buyers, income fraud, and undisclosed second mortgages — Nevada was among the hardest-hit states for mortgage fraud during the 2000s housing boom✓ Correct
CA lender's error in calculating the interest rate
DAny disagreement between a borrower and lender in Nevada
Explanation
Mortgage fraud involves intentional misrepresentation to obtain mortgage financing or better loan terms. Common schemes include: income/asset fraud (overstating qualifications), appraisal fraud (inflated values), occupancy fraud (claiming primary residence for an investment property), straw buyer schemes, and flip fraud. Nevada, particularly the Las Vegas market, experienced widespread mortgage fraud during the housing bubble. FBI investigations and HUD enforcement have resulted in significant prosecutions of Nevada real estate professionals for mortgage fraud.
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