This is the most common form of mortgage fraud. Property flipping in itself is a legal and ethical real estate practice when all disclosures as to the property condition and value are true and accurate.
Property flipping becomes illegal when the value of the home is artificially inflated either through a fraudulent appraisal and/or fictitious renovations. Illegal property flipping can involve a single property and/or multiple properties usually sold in a short period after acquisition by the perpetrator.