Mortgage Fraud Lawyer for False Claims and Qui Tam Cases
One of the American Dreams is home ownership. Americans have long had one of the highest percentage of people who own their own home in the world. Unfortunately, due to widespread home mortgage fraud in the 2000’s, tens of millions of people were harmed through fraudulent practices.
Mortgage bond investors lost billions through the purchase of sub-prime mortgages that were touted as being top-grade investments. Retirement account holders saw the values of their accounts decline significantly as the result of such investments. Homeowners saw the value of their homes plummet as the result of other homes in their area going into foreclosure. Unemployment increased dramatically from the ripple effect throughout the economy from financial losses and the downturn in construction and other financial sectors.
In reaction to this widespread fraud, additional regulations were implemented which resulted in increased hurdles and impediments to future home ownership.
As a mortgage fraud lawyer, I help clients expose mortgage loan fraud against the federal government, and also seek for them the compensation to which they may be entitled under the Qui Tam provisions of the False Claims Act.
If you are aware of mortgage fraud, I would invite you to call me for a free consult. I can then explain how False Claims Act cases are brought, how the False Claim Act may apply to your case, and answer any questions that you may have. There is no fee for my services unless compensation is obtained.
The Role of the US Government in Mortgage Loans
The United States government assists in helping individuals purchase homes through a number of programs, including those administered through the Department of Housing and Urban Development (“HUD”), the Fair Housing Administration (“FHA”), a governmental organization that guaranty mortgages (known as “Fannie Mae”), and an organization known as “Freddie Mac” which buys mortgages and re-bundles them into packages of securities that are subsequently re-sold.
These organizations, and the regulations involving the federal government’s role in lending, depend upon lenders and underwriters complying with the regulations under which their conduct is governed. Such regulations are in part designed to ensure that only qualified loan applicants and those eligible under certain governmental programs receive the governmental guaranty and other benefits associated with their loans (such as servicemembers being eligible for VA loans, and those with low incomes being eligible for FHA loans).
The Frequent Causes of Mortgage Fraud
Significant mortgage fraud has occurred when underwriters do not properly comply with lending regulations, and those who do not meet the creditworthiness or other requirements are nonetheless approved. In these instances, the loans made typically have a high default rate, which ultimately injures the federal government and other mortgage loan investors.
As an example, in some cases, those who do not meet the creditworthiness tests are encouraged to lie on loan applications about their income, or the underwriters choose not to verify such income. Mortgage brokers and those generating the loans personally benefit from these actions, as they typically earn a commission and/or origination fee with every loan processed. Real estate agents also benefit through commissions when homes are sold. Agents, mortgage brokers, and banks may choose appraisers who exaggerate value or fail to note disqualifying conditions which would stop the government from backing the loans.
Many lenders are Direct Endorsement qualified, meaning that the government trusts them to do their own quality assurance to avoid lending to unqualified buyers or on homes that do not qualify for the government’s loan guarantees. Fraud by Direct Endorsement and other lenders can result in large rewards for the whistleblower who turns them in.
Because the mortgages are then usually sold or re-packaged into other security instruments, ultimately it is usually the government and downstream investors who bear the cost when the loan goes into default, and those perpetuating fraud not only escape negative consequences, but in fact profit from fraud.
The False Claim Act Encourages the Reporting of Mortgage Fraud
If you are aware of systematic mortgage fraud, please call me to learn how you can be a hero and report such illegal activity, and to find out about the potential payment to which you may be entitled as a reporter of mortgage fraud.
I offer a free consultation and I and my firm are only entitled to a fee if compensation is awarded through a trial or as part of a settlement. I would invite you to contact me today to learn more.