This crime may be charged as a felony or a misdemeanor.
In California, the real estate market is still hot, with houses often selling quickly after being put on the market. That makes it an attractive place to get into the real estate game, whether you’re an investor looking to flip houses, a prospective landlord, or simply someone looking to purchase a home. But if you are going to get into real estate in California, be careful — there are strict rules governing various types of real estate fraud, with severe penalties for any violations.
Real estate fraud is a type of California criminal fraud. It is any fraud that occurs in connection with a real estate mortgage, foreclosure, rental property, real estate deed, or some forms of property flipping. Because real estate fraud often involves larger sums of money, many real estate fraud cases may be prosecuted under California’s grand theft law. Other types are prosecuted under specific real estate fraud statutes, such as foreclosure fraud, rent skimming and recording forged deeds. Depending on the facts of the case and the defendant’s criminal history, real estate fraud could be charged as either a felony or a misdemeanor.
According to a criminal defense lawyer Riverside, CA, fraud occurs when a person knowingly misrepresents or conceals certain facts to induce another person to act in a way that is harmful to his or her interests. Real estate fraud is fraud that is committed in connection with a real estate transaction — for example, making a false representation to obtain a mortgage.
Prosecutors often charge people who commit real estate fraud with grand theft. To prove this crime, a prosecutor must demonstrate the following:
- The defendant knowingly and intentionally deceived a real estate owner or mortgage lender by making a false or fraudulent representation;
- The defendant did so intending to persuade him/her to let him or her take possession and ownership of the property or loan proceeds; and
- The victim let the defendant take possession and ownership of the property or loan proceeds because s/he relied on the false representation.
To reach the threshold of grand theft, the property value must be $950 or more.
Other types of real estate fraud include foreclosure fraud, which involves:
- collecting or charging compensation for a service that the defendant agreed to perform on behalf of the homeowner before providing that service;
- charging or collecting excessive fees for services;
- taking a lien on the property, requiring any other security as collateral for compensation, or taking any interest in the property;
- taking money or property from a third party in connection with agreed-upon services without fully disclosing that information to the homeowner;
- taking a power of attorney from the homeowner; and/or
- inducing or attempting to induce the homeowner into signing an illegal contract.
Rent skimming may also be charged if you fail to apply rent proceeds to the mortgage in the first year after acquiring a residential rental property; or if you pretend to own a property that you do not really own, and fraudulently rent it out and keep the proceeds for yourself. There are exceptions to this law, such as if you pay licensed contractors to correct violations of the rental property. Forging deeds or documents is another common type real estate fraud.
If you have been charged with any type of crime related to real estate fraud, you will need an experienced criminal defense lawyer Riverside, CA to represent you. These laws are incredibly complex, and require the assistance of an attorney who understands the sophisticated financial and legal aspects of each case.
The Chambers Law Firm helps clients in Riverside and the surrounding areas who have been charged with real estate fraud and related crimes. We offer free initial consultations, where we will explain your rights and options for moving forward. Contact our office today at 714-760-4088 or dchambers@clfca.com to schedule an appointment with a criminal defense lawyer Riverside, CA.
