In California, various forms of real estate and mortgage fraud are strictly prohibited by law. These crimes typically involve deceitful tactics used to gain an unfair advantage in real estate transactions, affecting home purchases, rentals, foreclosures, and commercial properties. Understanding these offenses and the penalties involved is crucial for anyone facing such charges.
For personalized legal advice, contact Law Office of Michael L. Fell at (949) 585-9055 for a free consultation with an experienced criminal defense attorney.
Types of Real Estate and Mortgage Fraud
Real estate and mortgage fraud encompass several specific crimes, each with unique characteristics and legal implications. The most commonly prosecuted offenses in California include:
Theft by False Pretenses
This crime occurs when someone deceives another person by making false promises, leading the victim to transfer property ownership or pay more than the property's actual value. In real estate transactions, this might involve tricking a buyer into believing a property has more value or potential than it does.
Rent Skimming
Rent skimming can happen in two ways:
- Collecting rent on a property the individual does not own.
- Purchasing a rental property and failing to apply the rental income toward the mortgage during the first year.
Forgery
Forgery is prevalent in real estate transactions, often involving the creation of fake deeds or other legal documents. Filing a falsified document with a government office, such as a county clerk’s office, is illegal and constitutes forgery.
Foreclosure Fraud
Foreclosure fraud targets distressed homeowners with false promises of help. Scammers may pretend to offer assistance, such as preventing a bank from seizing a home, but fail to provide any actual service after collecting a fee.
Common Fraudulent Real Estate Schemes
Several schemes are frequently used in real estate fraud, especially targeting those in vulnerable situations, such as facing foreclosure:
Bait and Switch Title Transfers
In this scam, a foreclosure counselor may promise to help you keep your home but instead trick you into signing over the title. Homeowners might unknowingly transfer ownership without realizing the true nature of the documents they are signing.
Fake Foreclosure Assistance
Scammers offer to help stop foreclosure for a one-time fee but disappear after receiving payment, providing no actual assistance or service.
Predatory Lending
Mortgage lenders might engage in predatory lending by adding illegal fees to your mortgage. Due to the complexity of mortgage documents, distinguishing between legitimate and unlawful charges can be difficult.
Inflated Property Appraisals
Appraisers can commit fraud by artificially inflating a property's value. This scam benefits the seller, who can sell the property at a higher price, often with the appraiser receiving a kickback or commission for their part in the fraud.
Penalties for Real Estate and Mortgage Fraud
The penalties for real estate and mortgage fraud in California can be severe, varying based on the crime's nature, the amount involved, and the individual's criminal history. These offenses can be charged as misdemeanors or felonies:
Misdemeanor vs. Felony Charges
- Misdemeanor: Up to one year in county jail.
- Felony: Up to three years in prison.
Specific Offenses and Penalties
- Grand Theft: More common in real estate fraud due to the high value of transactions, punishable as either a misdemeanor or felony.
- Foreclosure Fraud: Can be charged as a misdemeanor or felony based on the case specifics.
- Rent Skimming: First-time offenses are typically not criminally prosecuted, but repeat offenders face felony charges.
- Forgery: Always a felony, with penalties including up to three years in prison and fines up to $10,000.
Seeking Legal Assistance
If you are facing charges of real estate or mortgage fraud, it is essential to seek experienced legal representation immediately. These cases are complex and carry significant penalties. For expert legal advice and defense, contact Law Office of Michael L. Fell at (949) 585-9055 for a free consultation. Our knowledgeable attorneys will review your case and help you navigate the legal process to achieve the best possible outcome.