Humber/Ontario Real Estate Course 2 Exam Practice

A large mortgage fraud scheme:

1. Is typically carried out by one person.

2. Would always involve a person employed by the mortgage company.

3. Typically involves several persons.

4. Would rarely involve overvalued real estate.

5. Usually requires collusion with real estate appraisers.

6. Does not affect the housing market significantly.

The correct answer is: Typically involves several persons.

A large mortgage fraud scheme typically involves several persons rather than just one individual. This is because multiple individuals might be needed to carry out different roles in such a scheme, such as the borrower, mortgage broker, real estate appraiser, and others. Collaboration among various parties can help in executing the fraudulent activities successfully. It's important to have multiple parties involved to carry out different aspects of the scheme. Option A is incorrect because large mortgage fraud schemes usually involve multiple individuals working together instead of being carried out by just one person. Option B is incorrect as it states that the fraud would always involve a person employed by the mortgage company, which is not necessarily true. Fraud can involve individuals from various backgrounds and positions, not exclusively limited to those working for the mortgage company. Option D is incorrect because large mortgage fraud schemes can involve overvalued real estate as part of the fraudulent activities. Inflating property values is a common tactic in mortgage fraud schemes. Option E is incorrect as collusion with real estate appraisers is not always a requirement for carrying out a large mortgage fraud scheme. While it can happen, it is not a universal feature of such schemes. Option F is incorrect as large mortgage fraud schemes can indeed have a significant impact on the housing market. Fraudulent activities can distort market prices, lead to foreclosures, and erode trust in the real estate sector.