Maryland Mortgage Fraud Lawyer Helping Homebuyers
If something about your home purchase, refinance, or loan modification did not feel right, such as documents changed at the last minute, or you discover hidden latent defects or other problems after your purchase, Whitney, LLP’s Maryland mortgage fraud lawyers may be able to help. As discussed below, Maryland’s Maryland’s Mortgage Fraud Protection Act defines mortgage fraud broadly, including knowingly making, using or facilitating any deliberate misstatement, misrepresentation, or omission, and making or using false documents during the mortgage lending process.
Whitney, LLP’s Maryland mortgage fraud lawyers have found that many of our clients who contact us about real estate problems such as undisclosed condo special assessments, latent defects and other deception by sellers and real estate agents have strong Maryland mortgage fraud lawsuits in addition to their other claims.
In Maryland, mortgage fraud can also include lies or omissions on the required Maryland Residential Property Disclosure and Disclaimer Statement (for example, hiding latent defects or not answering other questions honestly) and concealing soon-to-be-enacted special assessments, structural or building‑code problems in condominium resale paperwork—especially when those statements are used by lenders, appraisers, or underwriters to approve your loan. Maryland’s Mortgage Fraud Protection Act (Real Property, Title 7, Subtitle 4) is designed to address exactly this kind of conduct.
If you are looking for a Maryland mortgage fraud lawyer, Whitney, LLP represents Maryland homeowners and condo buyers in real estate fraud and mortgage fraud cases. We represent homebuyers across Maryland, including in Annapolis, Baltimore, Bowie, Bethesda, Rockville, Towson, Gaithersburg, Upper Marlboro, Frederick and Ocean City.
Contact Whitney, LLP for a Free Maryland Mortgage Fraud Case Evaluation at 410 583 8000, or use our Quick Contact Form.
Watch our YouTube Channel to learn about some of the other cases we handle and some of our results.
Maryland’s Mortgage Fraud Statute — What Homeowners Need to Know
Maryland’s Mortgage Fraud Protection Act provides tremendous protection to buyers and owners of residential real estate, including single family homes, townhouses and condominiums.
Maryland law defines mortgage fraud broadly, as follows, which allows Whitney, LLP’s mortgage fraud lawyers to apply it to a variety of facts and situations that our clients are dealing with:
What Maryland’s Mortgage Fraud Law Covers
Maryland defines “mortgage fraud” as any action taken with intent to defraud during the mortgage lending process—such as knowingly making or using false statements, creating or using false documents, receiving funds you know came from a fraudulent closing, conspiring with others, or filing a document in the land records that you know contains a deliberate misstatement.
The law specifically says the mortgage lending process includes soliciting, applying, underwriting, servicing, signing, closing, funding—and even the notarizing—of any document connected to a mortgage loan. It also clarifies that a “document” includes any required disclosure (like seller disclosure/disclaimer forms).
Put simply: if someone lies or forges to push a mortgage forward, and intends those lies to be relied upon, Maryland’s mortgage fraud statute is in play. Whitney, LLP’s mortgage fraud lawyers can determine whether to apply the mortgage fraud statute to a homebuyers potential claims.
Misstatements on Maryland Disclosure/Disclaimer Forms and Condo Resale Documents Can Be Mortgage Fraud
Maryland requires sellers of most single‑family homes to provide either a Residential Property Disclosure or a Disclaimer. Even with an “as‑is” Disclaimer, sellers must disclose latent defects they actually know about—problems a careful visual inspection wouldn’t reveal that threaten health or safety (for example, concealed foundation movement, serious behind‑wall water intrusion, or unsafe wiring).
Condominiums (Resale certificate/package). For condo resales, the law requires a resale certificate that must disclose (among other things) special assessments, pending lawsuits, the current budget and reserves, and whether the council of unit owners has actual knowledge of any health or building‑code violations affecting the common elements. Unit owners also must state whether they know of code violations in the unit or limited common elements. These disclosures are provided to buyers—and often end up in lender files during underwriting.
How that becomes mortgage fraud: The Mortgage Fraud Protection Act treats as “mortgage fraud” any deliberate misstatement, misrepresentation, or omission during the mortgage lending process, and it expressly includes “any required disclosure” in the definition of a covered “document.” If a seller, HOA/condo board or manager, or their agent knowingly submits a disclosure/disclaimer form or condo resale document that hides problems—with the intent that a buyer, lender, appraiser, or underwriter relies on it to approve a loan—that can constitute mortgage fraud.
Why structural issues in condos matter to lenders. Today, condo loans can be ineligible if a project has critical repairs, significant deferred maintenance, or certain safety/structural problems. Underwriters rely on condo questionnaires and resale information to screen exactly for these red flags. Hiding known structural damage—or the special assessments needed to fix it—to push financing through undermines those rules and squarely fits the statute’s focus on false statements used in underwriting.
Examples of failure to disclose problems as mortgage fraud
- A seller checks “no known defects” on the Disclosure/Disclaimer but knows about concealed structural foundation damage—yet the form is provided to the lender as part of underwriting. That undisclosed latent defect may support a mortgage‑fraud claim.
- A condo board (or manager) issues a resale certificate stating no code violations and no special assessments despite engineering reports confirming structural concrete deterioration and a pending assessment—information lenders use to determine condo project eligibility.
Whitney, LLP’s mortgage fraud attorneys have experience with mortgage fraud claims involving both single family homes and condominiums.
Common Examples of Mortgage Fraud
- Hidden Loan Fees
A lender deliberately adds undisclosed “processing” or “administrative” fees at closing, misrepresenting the true cost of the loan. - Inflated Interest Rates
A broker tells a consumer they qualify for a low rate, but falsifies documents so the lender issues a much higher interest loan, pocketing incentives from the lender. - False Promise of Fixed Rate Loan
A borrower is told they are signing a fixed-rate loan, but the final documents are switched to an adjustable-rate mortgage with steep payment increases. - Property Overvaluation (Square Footage Fraud)
A seller and appraiser misrepresent a home’s square footage to make it appear larger than it is, inflating the appraised value and the buyer’s loan amount. - Failure to Disclose Defects
A seller knowingly conceals major defects—such as a cracked foundation, flooding, or mold—and fails to disclose them on the Maryland property disclosure/disclaimer form, misleading the buyer and the lender. - Misrepresenting Property Condition
A real estate agent markets a home as “newly renovated” or “structurally sound” while knowing that the renovations were superficial and that serious electrical or structural problems exist. - Document Forgery at Closing or during the Mortage Process
A consumer signs agreed-upon documents, but at closing the lender substitutes forged or altered versions with worse terms, relying on the borrower’s pressure to sign quickly.
Who Can Be Liable for Mortgage Fraud in Maryland?
Any person engaging in the mortgage lending process can face liability—brokers, loan originators, lenders/servicers, appraisers, title and settlement agents, notaries, “foreclosure rescue” operators, and even sellers or condo associations that supply false required disclosures used in underwriting or closing.
Civil Remedies for Homeowners (Treble Damages + Attorney’s Fees)
Homeowners can file a civil lawsuit under the MMFPA. If you prove a violation, the court may award up to three times your actual damages (treble damages) and reasonable attorney’s fees—and you don’t have to wait for any agency action or criminal case to finish.
In addition, the Attorney General can seek an injunction to stop ongoing violations and obtain orders to restore money or property to victims. The Commissioner of Financial Regulation separately has enforcement authority and can require restitution and other corrective actions.
Where can you file? (Venue). The statute lets you sue in several convenient places, including where the property is located, where any act furthering the fraud occurred, where closing occurred, where proceeds were held, or where a false document was filed in land records.
Whitney, LLP’s mortgage fraud lawyers can help determine the damages attributed to mortgage fraud and seek to maximize the recovery of compensation.
Criminal Penalties for Mortgage Fraud
Mortgage fraud is a felony in Maryland. Penalties scale up depending on the conduct: up to 10 years and $5,000 for a standard offense; up to 15 years and $15,000 if the victim is a vulnerable adult; and up to 20 years and $100,000 for a pattern of mortgage fraud. Courts may also order restitution.
The State may also seek forfeiture of real or personal property used or derived from mortgage fraud.
What To Do If You Suspect Mortgage Fraud in Maryland
- Collect your paperwork: loan apps, disclosures/disclaimers, condo resale certificate, emails/texts with real estate agents and lenders, appraisal, title/closing package, and any land‑records filings (deeds, assignments, substitutions, releases).
- Write down the timeline: who said what, when documents were signed/notarized, and when you first discovered something was wrong.
- Don’t sign anything new pushed by the suspected party.
- Talk to a lawyer early. Mortgage‑fraud cases are document‑heavy; early legal action can help preserve evidence, freeze proceeds, and pursue treble damages.
Whitney, LLP’s mortgage fraud attorneys can help homeowners determine if a mortgage fraud lawsuit is an option.
Top 5 FAQs About Mortgage Fraud in Maryland
1. What is considered mortgage fraud in Maryland?
Mortgage fraud occurs when a person knowingly makes a false statement, misrepresentation, or omission during the mortgage lending process, with the intent that someone else (lender, borrower, or another party) relies on it. Examples include hiding property defects, inflating appraisals, forging loan documents, or concealing fees.
2. What is the statute of limitations for mortgage fraud in Maryland?
For criminal cases, mortgage fraud is a felony in Maryland and has no statute of limitations—charges can be brought at any time. For civil claims, consumers generally have 3 years from when they discover the fraud to bring a lawsuit, though some contract claims may extend up to 12 years if the contract was signed under seal.
3. Who can be held responsible for mortgage fraud in Maryland?
Mortgage fraud can be committed by lenders, brokers, appraisers, real estate agents, sellers, or even third parties involved in closing. Victims can pursue claims against any party who knowingly made false statements, hid material facts, or filed fraudulent documents during the mortgage process.
4. What are common examples of mortgage fraud that hurt consumers?
- Hidden fees added at closing
- Misrepresenting loan terms (e.g., adjustable vs. fixed rate)
- Concealing structural defects or property damage
- Inflating appraisals or misrepresenting square footage
- Forging documents or altering loan applications
These fraudulent actions leave consumers paying more than they agreed to or buying homes with undisclosed problems.
5. What should I do if I believe I’m a victim of mortgage fraud in Maryland?
If you suspect fraud, gather copies of all loan documents, disclosures, and communications. Contact Whitney, LLP’s Maryland mortgage fraud lawyers immediately to review your case. An attorney can help you file a lawsuit, and pursue damages from the responsible parties.
Daniel Whitney, Jr. and Daniel Whitney, Sr. of Whitney, LLP
Whitney, LLP: Maryland Mortgage Fraud Lawyers for Homeowners
We represent homeowners and homebuyers across Maryland in mortgage fraud, real estate fraud, forged deed/notary fraud, appraisal fraud, false seller disclosures, and condominium structural‑damage misrepresentations. If a false Disclosure/Disclaimer or condo resale document was used to push your loan through, we can help you fight back.
Contact Whitney, LLP for a Free Maryland Mortgage Fraud Case Evaluation at 410 583 8000, or use our Quick Contact Form.
Searching for a Maryland mortgage fraud lawyer? You’re in the right place.
