Austin Mortgage Fraud Lawyers

Fraud Notice Required Under Texas Finance Code

Lenders, mortgage bankers, or licensed mortgage brokers must give a written notice at closing, warning applicants about the penalties for making false or misleading statements. This notice must contain specific language about the penalties under Texas law. Applicants have to verify and sign the notice, confirming their understanding of the penalties and the truthfulness of their application. However, if the notice is not provided, the validity or enforceability of the home loan is unaffected. Failure to provide the notice required by Texas Finance Code Section 343.105 does not serve as a defense to fraud charges.

Reporting Requirements in Texas For Suspected Mortgage Fraud Cases

Texas Statutes Section 402.033 requires reporting any suspected fraudulent activities to an authorized government agency. These agencies include the attorney general, local or state law enforcement, and various state departments such as the Texas Department of Banking and the Texas Department of Housing and Community Affairs. Financial institutions and individuals who report these activities are protected from liability and cannot notify the suspects.

Criminal Process for Individuals Facing Mortgage Fraud Charges

If you are investigated or charged with mortgage fraud in Texas, you will go through several stages in the criminal process. First, you may be contacted by law enforcement or receive a subpoena. If charges are filed, you will be arrested and booked, then appear in court for an arraignment where you will enter a plea. Depending on the complexity of your case, pre-trial hearings will follow. During these hearings, evidence will be presented, and motions may be filed to dismiss or reduce charges.

If your case goes to trial, both sides will present their arguments, call witnesses, and submit evidence. The judge or jury will then decide your guilt or innocence. If convicted, sentencing will occur, where the judge will determine your punishment. This can range from fines and probation to imprisonment, depending on the severity of the fraud and any prior convictions. Throughout this process, having a lawyer by your side is vital to navigating the legal system and defending your rights effectively.

What Is Federal Mortgage Fraud?

Federal mortgage fraud, under 18 USC Section 1014, happens when someone knowingly makes false statements or reports, or willfully overvalues property, to influence actions by various federal agencies and financial institutions. These institutions include the Federal Housing Administration, Farm Credit Administration, and others involved in loan and credit applications. Federal mortgage fraud covers a wide range of activities. It includes false information on applications, property overvaluation, and deceitful reports. Penalties for these actions can be severe, with fines up to $1,000,000 or imprisonment for up to 30 years, or both.

Potential Defenses for Mortgage Fraud Charges

When facing a mortgage fraud charge, several defenses may help you avoid conviction or reduce penalties. One common defense is lack of intent. For a conviction, the prosecution must prove that you intentionally or knowingly made a false statement. If you made an error or were misinformed, you might argue that you lacked the intent to deceive.

Another defense involves questioning the materiality of the false statement. The law requires that the false statement be materially misleading. If the false statement did not significantly affect the mortgage decision, you might argue that it was not material.

Challenging the evidence is also a key defense. The prosecution must provide strong evidence that you committed fraud. This includes showing that the false statements were intentional and that they influenced the mortgage process. If the evidence is weak or based on unreliable sources, you can argue that there is not enough proof to convict you.

In some cases, you may have relied on a professional, like a mortgage broker or real estate agent, who provided incorrect information. If you can show that you reasonably relied on their expertise, you might argue that you did not knowingly provide false information.

Lastly, you might challenge the validity of the investigation process. If law enforcement violated your rights during the investigation, such as conducting an illegal search or seizure, you can argue that the evidence obtained should be excluded from the trial.

How Can Mortgage Fraud Defense Lawyer Help Your Case?

A criminal defense lawyer plays a crucial role when you face mortgage fraud charges. They provide you with legal advice, helping you understand the charges and potential consequences. They also investigate your case, gathering evidence and identifying weaknesses in the prosecution's case.

Your lawyer will represent you in court, arguing on your behalf during hearings and the trial. They will challenge evidence, cross-examine witnesses, and present arguments to defend you against the charges. They aim to create doubt about the prosecution's case, making it harder for the jury to convict you.

Negotiating with prosecutors is another key role of your lawyer. They may work to secure a plea deal that reduces the charges or penalties you face. If a plea deal is not in your best interest, they will prepare for trial and develop a strategy to defend you.

Throughout the process, your lawyer keeps you informed and advises you on the best course of action. They work to protect your rights and ensure you receive a fair trial. With their help, you have a better chance of achieving a favorable outcome in your case.

Related Offenses to Mortgage Fraud

18 USC § 1001 - Statements or Entries Generally

This statute makes it illegal to knowingly and deliberately falsify information, conceal important facts, or use deceitful documents in matters involving U.S. government operations. Violators may face up to five years in prison, or up to eight years if the case involves terrorism or certain other serious offenses.

18 USC § 1010 - Department of Housing and Urban Development and Federal Housing Administration Transactions

This law makes it illegal to use false statements or fake documents to influence any transactions related to loans or credits that might be insured by the Department of Housing and Urban Development. If someone lies, forges documents, or greatly overstates the value of assets to get loans or modify terms under these federal programs, they could face fines or up to two years in prison.

18 USC § 1014 - Loan and Credit Applications

This law targets fraudulent financial behavior in the U.S. It makes it illegal to knowingly lie or greatly inflate the value of property on loan or credit applications. This includes any attempts to mislead various federal agencies and banks, such as the Federal Housing Administration and the Small Business Administration, among others. Violators of this law could face serious penalties, including a fine of up to $1,000,000 and/or up to 30 years in prison.

18 USC § 1028 - Fraud in Connection With Identification Documents, Authentication Features, and Information

This law makes it illegal to create, transfer, or possess fake identification documents or authentication features with the intent to deceive. It targets activities like making or selling false IDs, possessing devices used to create these documents, and using another person's identification illegally. The penalties vary based on the specifics of the crime, such as whether it was done to facilitate other crimes like drug trafficking or terrorism, with maximum sentences ranging from one to thirty years in prison.

Frequently Asked Questions

What Is Mortgage Fraud?

Mortgage fraud is intentionally making false statements to get a mortgage loan.

Who Commits Mortgage Fraud?

Anyone involved in the mortgage process, including borrowers, lenders, and appraisers, can commit mortgage fraud.

What Are Some Examples of Mortgage Fraud?

Examples include inflating property values, hiding a second mortgage, and stealing someone's identity.

What Are the Penalties for Mortgage Fraud?

Penalties range from misdemeanors to first-degree felonies, depending on the amount of money involved.

How Can I Spot Mortgage Fraud?

Watch for signs like unexplained income sources, high appraisals, and missing documents.

Can I Go to Jail for Mortgage Fraud?

Yes, jail time is a possible consequence of mortgage fraud.

Is Mortgage Fraud a Federal Crime?

Mortgage fraud can be prosecuted at both the state and federal levels.

How Can I Defend Against Mortgage Fraud Charges?

A lawyer can help you challenge the evidence and argue your case.