Is this Mortgage Fraud?

mortgage fraud

A friend of mine is married but has not seen her husband in 4 years. He now lives in another county with his girlfriend. She just found out that he signed on a Mortgage with his girlfriend as a “Single Man” and on the Quit Claim Deed as an “Unmarried Man”. She has been asking for a divorce for 3 years now and just found this out. Does anyone know the recourse of this and because she lives in a “Community Property” state, is she entitled to either money or some of this property. I know she needs to see an attorney for a consultation. She just needs to know where to start and was it fraud on the Mortgage. I am sure the Mortgage Company does not know that he is still married and put down that he is unmarried and single. Please help!
If she doesn’t need an atty, then what does she do?
Packinrat… It is COUNTY NOT COUNTRY. thank you
O.K., seeing how this might NOT be Mortgage fraud, I know she may be responsible if he defaults. He lied saying he was single to get on the Mortgage. He probably thought she would never find out about this. Now, she is a nervous wreck and wants the divorce more than ever. She cannot afford an atty. What can she tell him in regards to what he did that was illegal?

Passive Income
Categories : homeowner loan



Community Property

Community property is a creation of the Civil Law of Rome and came to California via Mexico. When the Treaty of Guadalupe Hidalgo provided that property rights of Mexican subjects would be kept inviolate, early Californians felt compelled to continue the community property system and it became incorporated into the California constitution. In general, community property represents the earnings and accumulations of the marriage.

Persons who are not married to each other cannot hold community property together.

All property of married persons which is not their community property is the separate property of one or the other. Separate property consists of: (1) Property owned before marriage; (2) proceeds of separate property, such as dividends, rents, profits or property received in exchange for separate property; (3) gifts and inheritances received after marriage; (4) property agreed between the spouses to be separate property; (5) earnings of the wife when she is living separate and apart from the husband; and (6) earning of the husband when he is living separate and apart from the wife.

All deeds conveying community property must be signed by the wife as well as the husband. This is true, even though the property stands in the name of the husband or the wife.

Joint Ownership
We are often asked: ‘if we have different incomes, do we own less of the property’? In this section we try to explain some of the basic principles of Joint Ownership of property (and of course, joint ownership with a joint mortgage).

Share to Buy – a new form of joint ownership
Joint Ownership in the context of residential property is quite simply where more than one person owns a property together. If the joint ownership of the property involves a mortgage, then the mortgage will be on the basis of ‘joint and several liability’. That is, all parties to the mortgage are jointly and severally liable for repaying all of the mortgage. You can find more information on this point in our section on the share to buy joint ownership legal agreement.

Share to buy is a type of joint ownership where a structured legal agreement sets out the framework in which the property will be owned. This is the ‘share to buy legal agreement’ which we provide for free and sets out, among other things:

the share each person holds in the property and the mortgage what happens in the event that one of the joint owners wishes to leave Legal forms of joint ownership
Of course, share to buy is ultimately a brand name we have chosen for clubbing together to buy a property and while there is a legal agreement involved, it is very sensible to put such an agreement in place but it is not compulsory. However, there are forms of joint ownership that have specific legal grounding. There are two main types, joint tenants and tenants in common.

Joint tenants: neither party can sell without the other’s agreement. If one party dies, the other automatically inherits the other’s share. This is ideally suited to married couples or partners buying together who are in a long-term relationship.
Tenants-in-common: each party can dispose of his or her share, either whilst alive or through a will. This is more appropriate for friends buying a property together, where they do not intend to live together as a couple.
The share to buy joint ownership legal agreement, which we provide for free, requires that you hold the property as ‘tenants in common’ so that if one of the owners were to die, their share in the property passes to their estate.


Yes it is mortgage fraud and it can be basis for the mortgage company to deny his claim and put him in jail. Your friend needs to see an attorney ASAP. Since she is still legally married to him, she is financially responsible for his debt!!!!!


Fraud would be hard to prove here for two reasons: You have to show that he intended to get something by using deception that he would not have and you would have to show that the mortgage company would not have made the loan if he had indicated he was married.

However, she may be entitled to part of the new property depending on the laws in your state. Just because it is a community property state does not make it automatic. Some states have exemptions for deeded or titled property and many states have exemptions for property acquired after the parties have established separate residences. Only a lawyer will be able to tell her about this specific case.


I don’t know what Mr. Packinrat is talking about; I think he thought you meant “in another country” when you said in another county.

At any rate, if he is married but signed on a document as a single man or unmarried man, then yes that is fraud, although maybe not mortgage fraud. It matters not one whit whether the mortgage co. would have made the loan or not: he misrepresented himself when signing a legal document – that’s fraud.

But I’m a little confused about the recourse aspect. Unless your friend herself was somehow tied into the legal document he fraudulently signed, she would get no recourse for his defrauding the mortgage co. She was not defrauded by him claiming to be single while married to her.

About all she can realistically do is sue him for divorce.

She needs starting saving her pennies and see a lawyer pronto.

You said: What can she tell him in regards to what he did that was illegal?

I think you have it backward; she needs to see a lawyer, explain what her husband has done and then the lawyer needs to tell her what her husband did that was illegal and what she needs to do now.

She should not go to the lawyer telling him anything about the law, that’s the lawyer’s job. If her husband has done something illegal, it is the lawyer’s responsibility to take appropriate steps as an officer of the court.


Well, he did not accurately fill out the paperwork. However I am not sure if what he did is fraud. Did he gain any unfair advantage from lieing? His credit rating might have even been better being listed as married. Also since the husband now lives in another country, and has been seperated when he purchased, it will complicate matters.
The judge may also wonder why your friend has not sued for divorce as of yet, if he left 3 years ago.


David is right- if they have been separated, their income and debts are separate property. It’s ugly, but tell your friend to move on and get a divorce going so it will be over. I can’t believe the mortgage company would have missed his credit check and marital status. She can get a typing service to do the divorce. Make sure she lists all the known stuff so it gets adjudicated.


It creates a cloud on the title of the new house and potentially over anything your friend does financially until she clears it up.

It is probably not mortgage fraud since he would probably not have gained anything from his improper disclosure of his marital status.

His mortgage company will probably not be very active in requesting this change since they are not the one most damaged by this action. If he had claimed he was still married and your credit helped him get the loan, then you can guarantee the mortgage company would jump all over that.

Perhaps this is the point where your friend follows through and gets the divorce finalized after so long. I would want this corrected ASAP since if something happened to you or them, it could potentially leave an even bigger mess for the estate to clear up. Hand carry her, if necessary, to a lawyer and he can explain the necessary steps.


This is her big chance. She should file for divorce. Depending on her state’s laws she may also be able to seek an interest in her husband’s property or substantial settlement if he wants to save his house. She needs to see a lawyer.

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