YOU might rip up the fake note, but the previous owner may hang onto his copy and hold you responsible for it – or threaten to take you to court for fraud if you don’t pay him. I wouldn’t be surprised if he and the loan officer are in collusion.
As others have noted, the loan officer should be fired and kept from spreading his “creative financing” ideas to others. I would run from him – what he is suggesting is clearly fraud and he should be tarred and feathered if not indicted.
BTW, when it gets this twisted to buy a house, it is a big indicator that you should continue renting. If you would like to sleep at night and not fear opening the mailbox or answering the phone, I suggest you stay away from these schemes.
I think your heart is in the right place – since you are opening yourself up to opinions by posting these questions. Good for you for having the guts to ask in the first place.
