Beware the Mortgage Fraudster

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photo credit: ceonyc

Today the BBC is running a story about a mortgage broker called Isah Attayi who has been banned by the Financial Service Authority (FSA) for trying to fraudulently obtain mortgages for both himself and his clients by exaggerating his income.

In February, the Council of Mortgage Lenders (CML) warned of the scope for fraud by unscrupulous professionals in the property industry who tried to cash in on the demand for newly built city-centre flats.

As a property investor this is something that you at the very least need to be aware of. You will probably be in contact with a number or mortgage brokers that you use on a regular basis. Mortgage brokers tend to be like the sea, which comes in and goes out with the tide. This means that they all are good on their day – then their not so good, then they are good again.

Mortgage rates and deals change all the time. Suddenly one broker has a product from a lender that can’t be got elsewhere – because it’s exclusive. That’s why serious property investors use a bunch of brokers.

So why do you need to be careful? Many brokers fill out the forms for the applicant. If you’re a big investor this is a service you will insist on, otherwise you might as well apply for the mortgage yourself, after all – who wants to spend their life filling out forms? So you need to be absolutely sure that the information they fill out about you is exactly right and consistent. People make mistakes, they forget, they don’t understand.

Imagine for a second that you send the office junior out to get sandwiches and your only instruction is ‘get me anything but nothing that contains nuts’. The chances are you’ll be the one with the peanut butter and jelly sandwich.

[tags]mortgage, mortgage finance,mortgage fraud,business,real estate[/tags]