What is a mortgage fraud scheme that involves an inflated appraisal and a straw buyer called?

The term for a mortgage fraud scheme that involves an inflated appraisal and a straw buyer is correctly identified as "loan flipping." This practice typically involves obtaining a loan based on a falsely high appraisal value of the property. A straw buyer, who is an individual that temporarily purchases the property for someone else, is often used to conceal the real buyer's identity and financial profile.

Loan flipping not only distorts the true value of the property but also misrepresents the financial condition of the individuals involved. This scheme typically results in higher loan amounts and subsequent financial risks, as lenders are essentially misled about the property's true market value and the buyer's actual ability to repay the loan. By inflating the appraisal, the scheme can lead to significant financial losses for both the lender and the unsuspecting straw buyer.

Other terms like foreclosure fraud or predatory lending cover different types of deceptive practices in real estate but don't specifically address the combination of inflated appraisals and straw buyers. A kickback scheme involves illegal payments made to induce business transactions, which is unrelated to the scenario described. Therefore, "loan flipping" accurately encapsulates this specific fraudulent activity.