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Penalties for flipping a house?

If I buy a home stating that my intention was to live in it, but then flip it and list it for 50k more the following month, will I get fined? by citizenl133 from Lolo, Montana. 19 days ago Reply


Bert Carpenter (BertCarpenter)
#1 ranked lender in Arizona - 1,904 contributions

Probably, but it's worse than just a fine, you could end up in prison for Felony Mortgage Fraud. When you apply for a loan, upon which you certify and attest that ALL of the information provided is true and correct. you are stating your intention. You tell the bank that you are buying a home to live in, you don't move into it and sell it quickly, the lender is going to know. The bank takes a loss because of the quick payoff, they WILL launch an investigation. They find out that there was no compelling reason for the quick sale, like you were job transferred to another state. If they believe you were not truthful in the application, which now appears pretty obvious, they will likely turn you over to the FBI's Mortgage Fraud task force. I know of a scenario (not my deal) where the borrower said they were buying to move into it. Six months later, they are still living in the old home and now there is a tenant in his 'new' primary residence. The loan was not even delinquent, but they turned it over to the FBI and about 18 months later, buyer is doing five years in Federal prison for Mortgage Fraud, the home is foreclosed on, he lost his equity (he put 20% down) and his freedom.... For what? How does this impact you? When you get caught, and my money is on 'You will' you will be prosecuted and if convicted, in addition to prison time, you would be forced to forfeit the illicit gains and maybe do some prison time. Best advice I can give you is, do it the right way. You may only make $45,000, but how much is your freedom worth? ~ Bert Carpenter, The LoansA2z Team of NEXA Mortgage ~ NMLS 40586 ~ Licensed in Arizona, California, Georgia, Oregon, and Washington. Need help in other states? We got you covered. NEXA Mortgage is licensed in 46 states ~ www.ApplyYes.com 480-889-9000.

19 days ago
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 4,097 contributions

No way to hide that... That is straight up mortgage fraud. You are well advised not to attempt it.

18 days ago
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