To this day it amazes me that some people think that a mortgage broker’s job is to help create fake documents. If you’re self employed and you don’t report enough income to qualify for the mortgage you want, you can just call a mortgage broker and s/he will create the documents you need, right? WRONG!
This is fraud and it’s illegal!
Unfortunately, if you can believe it, there are people out there – some call themselves mortgage brokers – who do exactly this! They give the industry a bad name and they create very serious problems for people!
Recently I was working with a self employed couple who were looking for a mortgage. They were also dealing with a fraudster who said they could get the applicants the mortgage they wanted from a bank, even though there was no way the couple would legitimately qualify for the mortgage at the bank.
At first the bank approved the application, but then later reneged once they noticed “inconsistencies” in the information provided to them. Not only did the bank cancel the offer at the last minute leaving the applicant/borrowers scrambling, but the bank also reported the incident to Citadel fraud reporting centre, a division of Equifax, leaving what could be a permanent stain on the applicant’s credit profile.
I arranged a good, alternative institutional mortgage for the couple, but when my lender got notice of the Equifax/Citadel warning, my lender cancelled too. The couple’s credit profile had been damaged and unless they could get the original bank to withdraw the report to Equifax, the borrower/applicants might never again be able to borrow money from the bank or qualify for an institutional loan.
Next I arranged private financing for the couple, albeit at a higher rate, to help them with their objective of closing the transaction on time. I never heard back from the couple again, so I don’t know what they ultimately did.
It’s never easy when you work hard for people and then they disappear on you, but it does happen occasionally. I guess you really have to wonder about the character of some people to begin with, who would willingly get into bed with a fraudster just to try and save a few dollars.
So then what DOES a creative mortgage broker do?