In this post we’re going to continue our ongoing look at New York’s penal laws, this time with the various charges involved in mortgage and creditor fraud. So first off, let’s start with fraud in insolvency.

Fraud in insolvency.

For this section, administrator basically means an assignee or trustee for a creditor’s benefit, liquidator, or any other type of person who’s entitled to administer property. Now to be guilty of fraud in insolvency, you’ll have to have conveyed or transferred any part of the debtor’s estate, or obtain a substantial part of the debtor’s estate, present a false material statement to a creditor, or misrepresent any part of the interest in the debtor’s estate, all with the intention to defraud. This crime is a class A misdemeanor.

Fraud involving a security interest.

You’re guilty of this particular crime when, after executing a security agreement, you have under the security agreement the right of sale or other kind of disposition of the property, or having under the security agreement you secrete, withhold, or dispose of the property. This crime is charged as a class A misdemeanor.

Fraudulent disposition of mortgaged property.

A person is guilty of this crime when they sell, assign, exchange, or otherwise dispose of some sort of property with the intention of defrauding the mortgagee in question. This charge is a class A misdemeanor.

Fraudulent disposition of property subject to a conditional sale contract.

To be guilty of this crime, you’ll have to have sold, assigned, mortgaged, or otherwise disposed of goods in order to defraud someone else. Fraudulent disposition of property subject to a conditional sale contract is a class A misdemeanor.

Definitions.

In order to cover the next portion of this article, we’re going to have to get into some definitions.

  • By person, we mean an individual or entity.
  • Residential mortgage loan is a loan or agreement to extend credit, including renewing a loan that’s primarily secured by a mortgage, deed of trust, or any other lien.
  • A residential real property is real property that’s been improved by a one-to-four family dwelling, or else a residential unit in a building that includes units that are owned as condos.
  • Residential mortgage fraud is committed when someone knowingly and with the intent to defraud presents or prepares with knowledge or belief that it’ll be used to solicit an applicant for a residential mortgage loan, any written statement that contains false information about any fact, or which conceals information that concerns any fact material.

Limitation on prosecution.

It’s important to note that no one who applies for a residential mortgage loan and actually intends to occupy this property will be held liable provided that anyone who commits a crime defined in this article can be charged as an accessory to the crime.

Residential mortgage fraud in the fifth degree.

This charge is simply when you commit residential mortgage fraud, and it’s punished as a class A misdemeanor.

Residential mortgage fraud in the fourth degree.

This crime is when you commit residential mortgage fraud and receive proceeds in excess of $1,000. This charge is considered to be a class E felony.

Residential mortgage fraud in the third degree.

Same thing here, but the total amount has to be greater than $3,000. This charge is a class D felony.

Residential mortgage fraud in the second degree.

If you’ve committed mortgage fraud with a total in excess of $50,000, you’re guilty of this crime and will be facing a class C felony.

Residential mortgage fraud in the first degree.

And finally we have the first degree charge for this crime. This applies when the proceeds are in excess of one million dollars, and is punished as a class B felony.

So there you go. Even though the letter of the law can be pretty complicated and filled with legalese that you’ll need a machete to hack through, it doesn’t always have to be. In fact, when we break down the New York penal law the way that we have, I think you’ll agree that it even becomes kind of simple. So if you’re facing any kind of legal trouble or might be in the future, it’s best that you get in contact with the folks at Joseph Potashnik and Associates, PC.