Comment by MichaelBurge
3 years ago
I don't want to derail the thread into discussing exact mechanics. I just think if most people underwrote loans according to their intuition, they'd lose a lot of money. And a tax return is controlled by the same person applying for the mortgage, so is less valuable than the same information split among two people.
The FBI has a bullet point "Silent Second" on their page about mortgage fraud, so people have borrowed money for their down payments in the past and been prosecuted for it. That's not a new idea.
https://www.fbi.gov/investigate/white-collar-crime/mortgage-...
For the income taxes, my first thought would be "sell an NFT for $200k to a friend", now it's a gain on sale of property that can be offset by buying real estate in an "opportunity zone". Later, your friend can even claim a tax deduction when it gets "stolen".
He's self-employed with a business. So $200k in annual sales to his friend, and then he purchases $200k of equipment depreciated over 5 years from the same friend but split among 12 different shell companies so it's not obvious. He does pay taxes the first year, but gets it back over the next 4 years.
That page mentions leasing from the owner at inflated rates, and then getting it appraised at a multiple of the profit. It's not a direct example, but does use inflated income transferred between friends. They probably wouldn't mind paying taxes on the lease income during that time, since the multiple is often 20x.