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Cash-Out Refinance Loans allow homeowners to replace their existing mortgage with a new one that has a higher principal amount, thus enabling them to withdraw the difference in cash. While this can be a useful financial tool, it can also be susceptible to fraud. For instance, fraudulent activities might involve inflating property values or borrower income to secure a larger loan amount than the borrower is actually entitled to. Some may falsify documents or use false identities to obtain the cash-out funds, leaving lenders at risk of significant financial loss and potential legal complications. Identifying and preventing such fraud requires diligent verification of property values and borrower information.