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Thread: Mortgage Fraud Affects Everyone
09-17-2007, 09:27 PM #1
Mortgage Fraud Affects Everyone
Officials Say Mortgage Fraud Is Growing Problem
MIAMI -- Mortgage fraud is a growing problem in South Florida. The crime can cause you to lose money by affecting the price of your home and your property taxes.
Pete, whose identity NBC 6 is concealing, wanted $250,000 to sell his South Florida condo but he got a better offer.
"I got a call from real estate agent who told me that he has a contract, an offer for $350,000," Pete said. "I asked him, 'If I'm asking 250 and they offer 350, there's got to be a catch.'"
Pete's hunch was right. The buyer wanted $100,000 back at closing.
Pete said he was told the extra $100,000 was going to be used to renovate the condo, but he had already updated it. He contacted the Miami-Dade Police Department.
"If the lender knew that money was going back to the purchaser, they would never do the loan," said Sgt. Richard Davis of Miami-Dade police.
Davis is an expert in mortgage fraud.
"It's an epidemic," he said. "The FBI even calls it an epidemic."
It works like this: Police said the buyer gets a loan using an inflated appraisal. They pay the original asking price and pocket the difference with no intention of repaying the bank.
"The mortgage fraud can affect everybody," Davis said.
So much so that Miami-Dade Mayor Carlos Alvarez has formed a special mortgage task force to stop it. NBC 6 gained exclusive access to their first meeting.
"On why the public should care -- homeowners, potential buyers, sellers -- what does this do to a neighborhood?" Alvarez said.
Realtors said the fraud happens in unlikely places -- neighborhoods in Coral Gables, Pinecrest, and pricey Gables by the Sea.
"In a week's time we might see more mortgage fraud offers than we do legitimate offers," said EWM Realtor Beth Butler.
Butler said her company frequently turns down deals that don't smell right.
"They usually will pick properties where you can get appraisals -- properties to appraise higher than they're actually worth," Butler said.
Davis said the task force would closely look at realtors, appraisers, closing attorneys and mortgage brokers.
"In the worst case scenario, people that are in the industry are part of the mortgage frauds," Davis said.
Davis said if you notice that homes near you are selling for more than they're worth, take a close look at your property taxes. Mortgage fraud could be pushing them up and costing you.
Please tell me that you reported that real estate agent to the State Real Estate Commission.
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Last edited by Bruce Breedlove; 09-17-2007 at 09:58 PM."Baseball is like church. Many attend but few understand." Leo Durocher