Understanding the Penalties for Real Estate and Mortgage Frauds in Florida


The rise of the real estate market means that there has also been a meteoric rise in frauds and other illicit activities. These frauds have grown rapidly over the years, with fraudsters coming up with new methods of deceiving those around them.

While swindlers and fraudsters are overwhelmed by the immediate payout of such frauds, they overlook the penalties in place due to their haste. Real estate and mortgage frauds have been subjected to extensive discussions, and a detailed list of penalties have been registered to ensure that the innocent homeowners are safeguarded.

Imagine the plight of a homeowner looking to buy their first home, swindled by a group of fraudsters. There is always a way out of such a mess, and the sunshine state guarantees that all citizens within the state are ensured a safe passage out of this situation.

Here we mention some of the common real estate frauds within the state of Florida, and what some of the common penalties are for those who break these laws.

Understanding Real Estate Fraud  

Before we get into the depth of the penalties set for fraudsters, we will first take some time out and shed some light on understanding real estate frauds as a whole.

Real estate frauds can happen in any form or shape, with the unifying point being the loss of the victim. The perpetrator in all such cases takes advantage of a victim stuck in a bad situation, and lures them into a fraudulent deal.

All parties involved in the business for real estate should ensure that they remain safe from all such activities and take pertinent legal action if the need be. Don’t take any red flags, and stray safe of danger. Real estate agents and companies should always try to be on the right side of the law, because being at the wrong side of the law entails numerous repercussions, in the form of penalties that we will be mentioning here.

Types of Scams

The frauds concerning real estate can take multiple forms, with each type having a different penalty associated with it.

The frauds that we see around real estate and mortgage can be associated with different stages of the whole process. These stages include:

  • Equity skimming by real estate agents
  • Home improvement fraud by a registered home improvement organization.
  • Illegal flipping of real estate to avoid taxes and to make profits.
  • Fraudulent loan organization that passes mortgage for people with low credit score.
  • Rental fraud through dubious agreement
  • Land fraud through dubious agreement
  • Foreclosure scam for families on mortgage

All of these frauds are extremely well planned and work towards swindling families for as much money as possible.

We can take the example of a foreclosure scam here, as it is the most common one nowadays. Foreclosure rescue scam happens to be exactly what you might think of it to be, with the only difference being that it is extremely well thought out and executed.

As part of the foreclosure scam, swindlers get in touch with families that aren’t able to save their homes by paying the mortgage on time. These scam artists get the families to sign a title transfer of their home for a temporary period. The title transfer is done in the name of the company running the transfer, and will have a total sale value, which will be a minor fraction of what that house is really worth. The company gets to stay in their home and pay their rent for the duration of the title transfer.

In actuality, the company sells this house, as soon as they get the ownership transferred to their name. The owner, on the other hand is stuck with the mortgage payments, until he/she realizes that it is too late.

Additionally, there are numerous mortgage frauds as well that are run by organizations and individuals looking to make the most out of the plight of families. Mortgage frauds can be troubling, because there is the looming threat of additional payments down the line as well. You can get in touch with a registered agent for additional help here, to make sure that you get what is best in your interest.

Penalties That Come for Real Estate and Mortgage Frauds

Any company or individual charged for initiating or accommodating real estate or mortgage frauds would be staring down a long list or steep barrel of penalties.

Laws for Fraud in Florida

The Statute 817.545 from the Florida State Law governs all real estate and mortgage frauds.

This law considers every person or organization guilty if they have intentions to defraud while:

  • Facilitating the misrepresentation of facts, for their own gain and for the loss of the other party.
  • Misrepresenting facts for getting a loan
  • Filling in a mortgage document with wrong details and instructions.
  • Receive proceeds through the misrepresentation of facts.

Common Penalties

In all cases of real estate frauds, the offence is counted as a felony, even if the amount of the fraud is believed to be under $1,000. The fraud would be considered as a second degree felony, if the amount is believed to be over $100,000. However, if the amount is anything below that, it would be considered as a third-degree felony.

Some of the common penalties given as part of such a fraud include:

  • Fines
  • Restitution
  • Probation
  • Prison Time

Fines for frauds that are committed during real estate or mortgage transactions tend to be extremely steep and can even cross the $1 million barrier, if the case is believed to be under prosecution at the federal level.

Prison sentences are also considered to be extremely common as a penalty for such frauds, as the state has a strict policy of negative reinforcement here. Restitution will also be paid for the family that suffered financial damages because of you, with the prison time being spent alongside as well.

With such extensive penalties, there is no room for swindlers in the state of Florida. However, the onus of safeguarding their financial security lies on homeowners, who shouldn’t fall for any schemes or too good to be true mortgage plans.


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