TYPES OF REAL ESTATE FRAUD Flashcards

TYPES OF REAL ESTATE FRAUD Flashcards Nominee loans/straw buyers:Concealing a buyer's identity by using another person's name and credit information to obtain a loan.INFLATED APPRAISALSAn appraiser intentionally submits a misleading report to a lender that indicates an inflated property value.PROPERTY FLIPPINGIllegal when a home is bought, appraised for more than it's worth, and sold within a short time frame. Kickbacks to the parties are FRAUDis an intentionally deceptive act. In a fraud-related lawsuit, the plaintiff must prove that the other party intentionally deceived the plaintiff.SILENT SECONDA property buyer accepts a second mortgage without disclosing it to the original lender. Often used when a buyer can't afford the down payment on a home.FALSE IDENTITYBorrowers may use a stolen or fictitious identity to obtain a home loan.the amount of damages a plaintiff can recover should a licensee knowingly commit a deceptive act or practice triple the amount unconscionable act or course of action,"an act or practice which, to a consumer's detriment, takes advantage of the lack of knowledge, ability, experience, or capacity of the consumer to a grossly unfair degree.EQUITY SKIMMINGAn investor receives title to a property- often by using a straw buyer-doesn't make the mortgage payments, and usually rents out the home until foreclosure occurs.Which of the following states that the person who committed the fraud, as well as anyone who knew about the fraud, failed to disclose it, and benefited from it, can be held liable for actual damages?Fraud in Real Estate and Stock Transactions Which of the following is true regarding the 2011 amendment to the DTPA It helps prevent frivolous lawsuits against real estate licensees.RESPONDING TO FRAUDDocument everything, Disclose everything to the lender, Verify accuracy of all closing statements, Withdraw from the transaction if it seems to be fraudulent UNDISCLOSED BUYER REBATESThe seller or another party provides funds that aren't included in the settlement statement. In order to be legal, rebates must be disclosed to the lender and must appear on the settlement statement.Misrepresentationcan be either intentional or unintentional