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Walk into a store, fill your pockets with merchandise, then walk out without paying?<\/li>\nThe answer most honest people would give to #1.\u00a0 through #3: \u2018absolutely not, it\u2019s dishonest and illegal\u2019.<\/p>\n
Yet when it comes to #4 it\u2019s amazing how many otherwise honest folk would deliberately be very economical with the truth in order to secure that \u2018must-have\u2019 mortgage funding for that \u2018must-have\u2019 property.<\/p>\n
Many people feel that this latter is perfectly OK. Even if the amounts stated are totally out of kilter, there is that dogged determination that prevails: \u2018I can afford it\u2019 even though that may not be true.<\/p>\n
What if the NOAs (CRA Notices of Assessment), T4s, T1s and pay stubs don\u2019t seem to measure up to the applicants\u2019 claims? No\u00a0 problem, just get someone to fabricate some new ones! There is a veritable underground\/cottage\/basement industry out there that will happily manufacture (forge) all of the above paperwork to enable some poor devil to dig him\/herself a deeper financial hole!<\/p>\n
Yet do these same people who would never commit crimes #1-#3 see nothing wrong with falsifying income claims etc. in pursuit of mortgage financing? Apparently not. hence the precarious position in which a large corporation, Home Capital, now finds itself.<\/p>\n
The story, although having taken place in 2016, has just emerged in the past month about Home Trust (the mortgage arm of Home Capital) being a victim of the crime of mortgage fraud.<\/p>\n
Home Trust, one of the best-known \u2018alternate\u2019 lenders in the mortgage financing business, discovered that some 45 mortgage brokers, when filling out applications, had been falsifying such critical information as earnings, employment longevity, and even critical CRA outstanding tax statements. Once the fraud was discovered, the 45 brokers were summarily dismissed.\u00a0 But the damage was already done. Once the news of the fraud leaked out that many mortgages may have been the product of falsified information and fraudulent activity, the dominoes started to topple.<\/p>\n
Since the lifeblood of any mortgage lender such as Home Trust is the deposits made by investors to generate mortgage funding, a crisis was in the making. Within a very short time after this information became public, millions of dollars were pulled out by nervous investors, causing a drop of some 60% in the value of the company stock, a very serious situation. So serious, in fact, that HomeTrust Capital was forced to negotiate a $2 billion Line of Credit in order to keep the funding pipeline open, and to date, approximately $1.7 billion has already been drawn on. So, some serious problems may lie ahead for this venerable lending institution; is a takeover by another institution, or total oblivion in their future? Only time will tell.<\/p>\n
And where did it start? #4, a bunch of greedy, dishonest, self-serving brokers bending the rules to make a buck! And, sad to say, they are not the only guilty parties, in my opinion, with soiled hands. I have talked to a number of would-be home-buyers, so anxious to get into the market and grab their \u2018piece of the rock\u2019 that they see nothing wrong in falsifying relevant documents, if necessary, to clinch the deal as they feel this to be a \u2018victimless crime\u2019. Tell that to Home Capital!<\/p>\n
I guess sometimes zeal trumps common sense and honesty!<\/p>\n","protected":false},"excerpt":{"rendered":"
Would you: Walk into a store, fill your pockets with merchandise, then walk out without paying? Gas up your car at a service station, then peel rubber without paying? Endorse a cheque payable to someone else then cash it? When filling out a mortgage application falsify information in order to obtain financing? The answer most […]<\/p>\n","protected":false},"author":2,"featured_media":855,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-845","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/posts\/845","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/comments?post=845"}],"version-history":[{"count":0,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/posts\/845\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/media\/855"}],"wp:attachment":[{"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/media?parent=845"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/categories?post=845"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/terrygetsmortgages.ca\/wp-json\/wp\/v2\/tags?post=845"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}