Mortgage Cash-Back Fraud

Cash-Back Schemes

Happens where the true price of a property is illegally inflated in order to provide cash-back to transaction participants, most often the borrowers, who receive a “rebate” which is not disclosed to the lender. As a result the lender lends too much, and the buyer pockets the overage or splits it with other participants, including the seller or the real estate agent.

This scheme requires appraisal fraud to deceive the lender. “Get Rich Quick” real-estate gurus’ courses frequently rely heavily on this mechanism for profitability.

Mortgage Fraud For Profit

 

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