5.3.8 Mortgage fraud

From: Financial Consumer Agency of Canada

While mortgage fraud is not common, both borrowers and lenders need to watch for signs of suspicious activity.

  • Foreclosure fraud can happen when you are having trouble making mortgage payments and worry that the lender will take possession of the mortgage property. A scammer offers to help you if you transfer title of the property. But instead of helping, the scammer keeps the property and your payments, or re-sells the property, and departs with the money.
  • With title fraud, a scammer steals or fakes your identity documents and pretends to be you. The scammer then sells your home, or takes out a new mortgage on it, and departs with the money. Sometimes, the scammer will rent your property from you, then pretend to be the owner and sell it. You may be left with no title to your home, or a mortgage you never agreed to.
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