Dual Contracting is described as which of the following?

Dual Contracting is described as which of the following?

• A. Loan fraud in all states
• B. A legal financing arrangement
• C. A standard listing practice
• D. A form of agency disclosure

Answer: (A)

Dual contracting means using two contracts in one real estate deal to hide the true terms, such as the actual purchase price or financing arrangements, from the lender. That deceptive setup makes the lender misinformed and, because it involves presenting false or misleading information to obtain loan funds, it is considered loan fraud. It's not a legitimate financing arrangement, not standard practice, and not a required form of agency disclosure. In short, dual contracting is illegal and treated as loan fraud.

Dual contracting means using two contracts in one real estate deal to hide the true terms, such as the actual purchase price or financing arrangements, from the lender. That deceptive setup makes the lender misinformed and, because it involves presenting false or misleading information to obtain loan funds, it is considered loan fraud. It's not a legitimate financing arrangement, not standard practice, and not a required form of agency disclosure. In short, dual contracting is illegal and treated as loan fraud.