Don’t Be a Mortgage Fraud Victim

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Written by Federal Bureau of Investigation   
fbi logo 62x64.jpgAccording to the FBI, the estimated annual losses* to mortgage fraud are $4 billion to $6 billion! Although there are many mortgage fraud schemes, the FBI is focusing its efforts on those perpetrated by industry insiders. The FBI is engaged with the mortgage industry primarily in identifying fraud trends and educating the public. This month, using information provided by the FBI, Creative Real Estate Magazine looks at mortgage fraud indicators, common mortgage fraud schemes, and tips to protect you from becoming a victim:

 

MORTGAGE FRAUD INDICATORS

Inflated Appraisals
• Exclusive use of one appraiser

 

Increased Commissions/Bonuses - Brokers and Appraisers
• Bonuses paid (outside or at settlement) for fee-based services
• Higher than customary fees

 

Falsifications on Loan Applications
• Buyers told/explained how to falsify the mortgage application
• Requested to sign blank application


Fake Supporting Loan Documentation
• Requested to sign blank employee or bank forms
• Requested to sign other types of blank forms


Purchase Loans Disguised as Refinance
• Purchase loans that are disguised as refinances
• Requires less documentation/lender scrutiny


Investors Short-Term Investments with Guaranteed Re-Purchase
• Investors used to flip property prices for fixed percentage
• Multiple "Holding Companies" utilized to increase property values

 

fbi chart sep 08 edit.jpg

 

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