With the recent emphasis on the borrower’s credit scores, many have looked to credit clean up services to improve their borrower’s credit scores. Be cautious as some companies are committing fraud and may be setting you up to take the fall. I’m not talking about correcting inaccurate information.
When you present a borrower to a lender, you are certifying all the information to the best of your knowledge is accurate. If the credit repair company is taking off ‘accurate delinquency’such as a mortgage lates, collections or even bankruptcy you are not presenting the borrower’s true credit profile. This is fraud.
The fact that the credit repair company has found a loop hole in the law to get the information removed, does not make it OK to then present this delinquent borrower for a loan with an inaccurately representative credit report. The loan originator and the lender certify with buy back provisions and possible criminal actions that the borrower has not misrepresented their information including their credit. If you have doubts about this issue, review the Federal Trade Commission website who has lots of information on indictments they have had in relationship to credit repair companies. www.ftc.gov.
What have you seen loan originators doing to misrepresent the borrowers to the lenders?
Tags: credit repair, Federal Trade Commission, Mortgage Fraud
