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Originally Posted by MBAtarga
So what is the result of this fraud? The non-owner gets a 2nd mortgage using the house as collateral and walks away with cash?
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In Alberta, the property owner would apply to a court for an order discharging the mortgage from his title, and the lender would be out the money.
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So this kind of sheet must happen a lot...recycled sixtie
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It flares up from time to time. The classic technique is where realtors prepare double offers to pump up the value of a property, and have property appraisers who are prepared to issue jacked up appraisals. They get real people, called qualifiers, to sign the documents, including inflated mortgages, and they get paid a fee for doing so. Sometimes the bank officers are in on it.
From a practitioner's standpoint, they're not that hard to spot.