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Flip That House - Mortgage Fraud Is On The Increase
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Mortgage Fraud has risen an alarming 30 percent and all the figures aren’t even in yet. Scam artists buy low priced properties and then flip them at a huge profit - but their doing so through shady methods - bogus appraisals, stolen ids and other devious ways. This mortgage fraud disrupts the whole system and results in ridiculous increases in property taxes and plunging property values.
Yet from coast to coast, these frauds often work the same way: Buyers gain control of properties at a low price and then sell them quickly at a big profit, rigging the game every step of the way by procuring bogus property appraisals and using false or stolen identities to obtain mortgages. While the scam artists profit in these flipping schemes, the lenders are ultimately the losers, left holding the bag when the loan on the home ultimately defaults.
The Mortgage Asset Research Institute said reports of mortgage fraud rose 30 percent for loans made in 2006 compared with those made in 2005. (The report also warned that it might take three to five years to uncover the full extent of fraud that occurred in loans made last year.)
(nytimes)
Via: nytimes
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