Are strategic defaulters facing jail time?

Thinking about strategically defaulting on your mortgage, and seeing how long you can live in your home without paying? Long enough to save up a down payment for your next home? Long enough to pay for that first-class flight to Cabo?

Think about what Heath Wolfe, a government official has to say in Lew Sichelman's syndicated column in the Chicago Tribune.

We are working with Fannie and Freddie to build a mechanism" to identify strategic defaulters, Wolfe said at a recent mortgage industry conference. So if you walked away from one property and bought another, chances are fairly good that the OIG is going to find you.

If you conveniently left off the fact that you have an outstanding mortgage you failed to pay, or that you have a deficiency judgment against you for the difference between what you owe and what the house sold for at foreclosure, you've committed mortgage fraud.

"Debts that haven't been repaid don't just go away," said a Treasury Department official who asked not to be named. "It doesn't matter whether it's on your credit report or not."

If there is any indication that you falsified information on your new loan application, the OIG is "absolutely" going to refer you for criminal prosecution, Wolfe said. "We're not just going to demand repayment," he said. "We're going to lock (people) up."

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