Dear Randster,
Much has been written about the role of lending fraud in this ongoing mortgage crisis. But borrower fraud is equally responsible.Certainly, originators and brokers were complicit in a high percentage of mortgage-fraud cases.

But a 10-year study by Base-Point Analytics found that loans with misrepresentation on the application were nearly five times as likely to default as honest applications.Moreover, as much as 70 percent of early stage defaults contained fraudulent information on the original loan applications, the study found.

Technically, you or whoever the "perp" may be in this instance could get rung up for "supplying false statements on a loan and credit applications," "making and subscribing to a false tax return" or another similar federal offense. But given the backlog of more severe mortgage-fraud cases, that's probably not going to happen.

The lender or U.S. Attorney's Office would have to somehow be made privy to this information. (Is some peeved party, such as an ex-spouse, threatening to out the fraudster perhaps?) Even then, it's very unlikely that anything would happen unless this case got lumped into litigation.The lender probably wouldn't come forward because it might fear being implicated in additional mortgage fraud. And it's very unlikely the lender would try to wrest away the home in this current flat market.

It probably has plenty of seized homes on its rolls already.Further, the FBI said in May that it is only pursuing cases of applicant fraud involving people who were involved in flipping rings, bogus foreclosure-rescue schemes, identity thefts and other multiple-victim mortgage offenses -- for now.If you or your party opts to take the high road and confess this, find a good real estate attorney first.

I also suggest that whoever did this should keep making those payments on time and think twice before legally signing off on knowingly deceptive information. Revised federal laws are in the works as we speak. The financial industry even has a name for these mortgages: "liar's loans." Mortgage fraud, Randster, is one reason we're mired so deeply in this mess.