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Mortgage fraud is prevalent in today’s financial markets. It was a great contributor to the recent economical downturn that has seen $trillions wiped from the value of real estate globally. It is when property values crash in this way, that mortgage frauds come to light as it is this time when the true value of properties and their associated loans are properly compared!

Buying a property as an investment, perhaps as an alternative or diversification of your pension, is always a very good idea. If you buy shrewdly, work hard at renting the property to respectable tennants and do your sums carefully, your success is very likely. However, if you respond to the glossy hype of property developers who would have you believe that buying from them is a sure way to success, then you will almost certainly fail.

Some property developers will sell you buy-to-let properties at inflated prices – they make the whole process easy so that you do not have to do any work at all. Sometimes they offer the opportunity to buy without even putting any money down as deposit. In such cases they might offer you a “builder’s deposit” which is effectively a discount from the price. However, it is a discount out of the already inflated price.

If you want to avoid buying a property that is worth less than the mortgage you will be offered – do not accept the services of the property developer’s “partners” who will value the property, arrange your mortgage and convey the legal formalities on your behalf. Always choose independent professional advisers – independent surveyors who will tell you what the property is truly worth, mortgage brokers who will find you the best deal and conveyance lawyers who will really act in your best interests.

The cost of your independent advice will be less than that offered by the property developers, who do not like you to use outside professionals. However, the saving in the long term will be even more and you will have the satisfaction of the peace of mind that goes with a secure purchase. Whether your vendor is committing fraud or is just a sharp business man will depend on the circumstances, but either way you must obtain your own advice.