Ron Butler@ronmortgageguy
Aug 26, 2025
6 tweets
What They Call Mortgage Fraud In The USA Is Just A Normal Transaction In Canada
It just got a Federal Reserve Governor fired yesterday
It's called a False Primary Residence Declaration & in the USA it's a crime that can come with jail time
In Canada it's accepted practice
2/
This is whether the house being mortgaged is a primary residence, a secondary residence or a rental
Owner Occupied: Best Mortgage Rate
Secondary Residence (Cottage): Not as good Mortgage Rate
Rental: Significantly higher Mortgage Rate
In the USA you MUST be truthful
3/
If you tell the bank the mortgage is for your Owner Occupied Home but it turns out to be a Rental that's Mortgage Fraud & you can be charged, arrested brought to trial & may go to jail particularly if you & the property are in different States (Federal Law Applies)
4/
Is this a crime in Canada?
Don't be silly
To be clear: Canadian Banks & Lenders also hate this practice of cheating to get a better rate
They do NOT want to be fooled about properties claimed to be Owner Occupied that instantly become Rentals the day after closing
5/
But it's not a crime
Completely Fake Income Documents to obtain a Mortgage aren't even investigated by cops in Canada
The USA solved Mortgage Document Fraud years ago through IRS Linkage & throwing Fraudsters in jail
But this False Occupancy Declaration is growing
6/
Again, in Canada it's a Nothing Burger, if caught after Closing no bank does anything, it may be flagged for Non-Renewal but that's it
Let's be clear: the USA takes everything about false Mortgage submissions VERY seriously
In Canada we don't
Ron Butler
@ronmortgageguy
The big, old, overly opinionated mortgage broker is worried about the future of housing for average Canadians
Missing some tweets in this thread? Or failed to load images or videos? You can try to .