I have recently seen a For Sale By Owner Ad in the Newspaper that read: Remodeled 3 bedroom 1 bath Victorian in ??????, great condition, $7,000 back to you at closing. First thing that entered my mind - Mortgage Fraud. It probably isn’t what the author had in mind but there really isn’t a possible way to pay the purchaser that amount after closing unless…… and then I remembered a contract from years ago. The seller and purchaser of a property decided, after the lender suggested it (out of town lender), that they would inflate the price of the home by $10,000 and seller would pay purchaser $10,000 after closing. After all the lender told them it would be okay as long as the $10,000 was not on the HUD.  Not!!! NO,NO,NO

If it’s not on the HUD it’s mortgage fraud 

& Mortgage fraud is a felony

It’s that simple!

http://homebuying.about.com/od/mortgagefacts/a/bank_fraud.htm