Loan Fraud

Missed Your House Payment?

December 18th, 2007 categories: Fraud, Loan Fraud, Real Estate

Home owners who are having difficulty paying their house payments and have missed house payments need to watch this video to help protect themselves.

As soon as you start missing your house payment, predators are eagerly contacting you and promising all kinds of help. Don’t be taken in by these fools. They will have you sign lots of documents and promise that you can stay in the house and rent it back from them. Please watch the video so you are not taken advantage of again.

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Also an excellent article that you might want to share with someone you know who is having difficulty paying their house payment is Avoiding Mortgage Fraud. Be careful who you talk to.

For authorized help, call 1-800-995-HOPE and on the Internet go to Tips for Avoiding Foreclosure by the U.S. Department of Housing.

Remember, if it sounds too good to be true, IT IS! Don’t get caught up in fraud where scammers are looking for a quick buck, that take your money, your deed and leave you holding the bag.

Think smart and only deal with reputible real estate agents, the bank where you have your loan and HUD.

Sacramento Real Estate Fraud-Homeowners Read This

November 19th, 2007 categories: Loan Fraud, Real Estate Tips, Sacramento

Sacramento homeowners need to be aware that Real Estate Fraud is front and center.

To the left is a copy of a letter that is being sent out to real estate property home owners when there has been a change in the ownership and or recording of your home/house, rental/property.

Since there is so much Real Estate fraud now, the District Attorneys office is sending out this letter whenever there has been a change of any kind in your property ownership. This could happen legally when as a homeowner you have refinanced your house.

So, dont be surprised if you receive a letter like this one if you have refinanced your house. Check over all the documents sent to you.

If you receive this letter and you have NOT refinanced your house, be sure to contact the Real Estate Fraud Hotline at 916.874.7442 immediately, or go to the Real Estate Fraud Division in Sacramento at the District Attorneys office and fill out the suspected fraud questionnaire.

There is a rise in real estate fraud where criminals are using your home equity, signing your name and pulling money out of your equity in your home and/or possibly selling your house.

This is why the Sacramento County District Attorneys office is sending out these letters both in English and Spanish along with a copy of the Deed of Trust on the property to every homeowner where there has been a change in the Deed of Trust recorded with Sacramento County.

Be aware, check carefully any documents you receive from the Sacramento Real Estate Fraud Division of the District Attorneys office.

This is just another indication of how important it is to work with a Realtor that you trust. When it sounds too good to be true it usually is NOT true. Please, help stop these predators by being diligent in whom you chose to work with.

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Sacramento Short Sales and Foreclosures

June 1st, 2007 categories: Foreclosure, Fraud, Homes For Sale, Loan Fraud, Mortgage, Real Estate, Real Estate Market, Real Estate News, Realtor, Sacramento

Back_to_Bank Sacramento, the surrounding areas as well as the State of California is experiencing the results of homeowners that couldn’t afford to purchase a home, bad lending practices and shady deals.

You add all that up together and you have Short Sales and Foreclosures. Now, here come the Auction Companies. I’m not saying that all Auction companies are bad. Just as there are bad Real Estate Agents and bad Lenders, there are bad Auction Companies.

There have been Real Estate offices open up almost on every corner, change their names frequently to avoid problems and agents who hop around from Real Estate office to Real Estate office. Some mom and pop organizations who have no training for their agents. And others who seem to train in everything but bettering their agents to be Realtors. Then of course we had the part timers who thought there was nothing to being a Real Estate agents and managed to make a mess.

Real Estate agents who took a crash course to gain more money by submitting loan applications have been a detriment to society. There is nothing illegal by these agents double dipping in Real Estate and in Lending. But, think about this…if you are doing your job full time and continually educating and conducting business in Real Estate, there is no way you have time to also keep up with loans, loan programs and regulations. What does that say? It says to me that you dabble…do I want someone that dabbles…or do I want someone who knows what their doing?

Some of these Home Buyers actually had dabblers finding them homes, writing up loan applications…on the biggest investment of their lives and they let a dabbler do it. I don’t understand that.

Now, the kicker here is that some of these same Real Estate agents were changing loan applications, puffing the amount of income so there home buyer could afford to spend more. Yes, fraud! This has helped lead California into the results of Bank owned property as we see in the chart above. These people need to get out of the business and leave those professionals to do the job correctly and honestly.

So much to say about all this…I do hope you can stick with me while I try my best to give you the best advice, in my opinion that I can muster without seeming to rant.

Auctions are nothing new. But, some of these companies are new to auctioning homes. They have been dealing with auctioning estate furniture, jewelry, cars etc. but not homes. Did I hear you ask, is there a difference? YES! Many of these Auction companies saw a niche and jumped in just like the agents who saw a niche to make more money doing loans and Real Estate. I have had the opportunity of witnessing how some of the companies work, what they charge and how they operate as well as how much experience they have selling homes. It’s not a pretty picture, folks.

This is a very expensive proposition when there are other alternatives. First, the Banks don’t want to own homes but that’s exactly what is happening. Banks need to start negotiating with the homeowners and revisit these audacious loans. If this isn’t done then the Banks need to start accepting Short Sales and stop this fervor. If the property is priced in value range pricing there is no reason for an Auction. It’s time to make some sense out of all this senselessness. Get a clue. We need to pull together here and make this a win, win instead of a continuous loose, loose.

Remember, if you don’t think this effects you, as a homeowner…think again. This effects every single one of us. It is what is driving the real estate prices down. It is time for the homeowners to stand up and let their voices be heard. Stop ruining neighborhoods with vacant properties, weeds, mosquito filled pools…this is not good for the economy, it’s not good for the Banks, it’s not good for the homeowner and it’s not good for the neighborhood.

If you have access to the Sacramento Bee or the on-line version, here is the article link dealing with the Sale of bank-held homes in California.

I hope I have sparked your interest and concern…we need to speak-up, not put up with this and demand a better solution.

Are Short Sales and Foreclosures A Good Deal?

Fraud in Real Estate

What Does Short Sale Mean?

Foreclosures, Buy or Don’t Buy?

Do You Understand Foreclosure?

2007 Where Knowledge is Power in Real Estate

Want to Be An Investor?

What Sellers Need to Know About Receiving Offers

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2007 Where Knowledge is Power in Real Estate

January 1st, 2007 categories: Fraud, Loan Fraud, Real Estate, Real Estate News, Real Estate Tips

2007Year Today, I would like to introduce you to our guest, Ed Rybczynski formerly with Liberty Title Company in Baltimore where in 2003, Ed pleaded guilty to Federal conspiracy stemming from house flipping and mortgage fraud.

Ed served time in Lewisburg Federal Prison Camp. Today,Ed spends his time educating others about fraud and helping Title companies to be proactive with strategies designed to reduce the risks of loss. Ed has served his time and currently consults making others aware of how there must be a change and not status quo read, devour and become aware so that you are not a victim of fraud in 2007.

Real estate fraud is a remarkably complex social issue with a spectrum of costs and consequences that are generally misunderstood. Its now identified by the FBI as the nations fastest growing type of white collar crime.

The Treasury Department reports a 35 percent increase in 2006, over 2005, of suspicious activity claims made by lending institutions. Still, the published number of incidents is understated because many crimes remain undiscovered, unrecognized or unreported. The term real estate fraud describes a broad category of crime that loosely includes mortgage fraud, predatory lending, property flipping, postal fraud, identity fraud and bankruptcy fraud.

Technology is not without blame for accelerating fraud statistics. All real estate is listed and sold locally, yet lenders and title companies increasingly employ a business model that encourages automated processing from remote locations. Sadly, homes being purchased have become digital images with a stated value while consumers are reduced to faceless ambiguous names on a computer screen.

Fraud clearly flourishes when lending and settlement services are anything other than community based. Another contributing factor is the approach taken by state governments when prescribing licensing and continuing education standards for real estate professionals. In April of this year, the Government Accountability Office released a preliminary study of the title industry requested by Congressman Michael Oxley.

Surprisingly, 3 states plus the District of Columbia dont require the licensing of title agents; 18 states and the District of Columbia dont require title agents to pass a test before licensing; only 20 states have an educational requirement as a pre-requisite to licensing. A similar scenario currently exists for the mortgage banking industry.

The media often portrays consumers as villains when, in fact, all forms of real estate crime require the coaching and orchestrated efforts of realtors, mortgage brokers, title agents and appraisers.

Its safe to assume that seemingly benign, yet criminal behavior is internalized to some degree in this nations real estate culture. Carol Lloyd, The San Francisco Chronicle, correctly described the problem in a recent column when she wrote: It’s the convoluted world of mortgage fraud, a crime in which it’s sometimes hard to disentangle victim from criminal and crime from business as usual.

While working as a title agent in Baltimore, MD during the 1990s, I heard a continuous stream of comments that illustrated the underpinnings of fraud in real estate deals. No one will know! Everybody gets paid! What difference does it make!

The buyer gets the house! Contrary to a belief held by many, consumers face the same risk of criminal prosecution as industry insiders when a fraudulent scheme is uncovered. Earlier this year, a federal grand jury indicted an Ohio mortgage broker and the seller of a home she was purchasing as a residence for their coordinated exploits to defraud a lender.

Far too often, fraudsters target neighborhoods and individuals that can least afford the abuse. Property flipping has decimated entire communities that were already at risk before the victimization began.

Repeated studies show that predatory lending practices are biased towards minority and lower income groups. A sophisticated lending concept known as the yield spread premium is frequently used to over-sell unsustainable payments to trusting customers. Abusive and deceitful loan brokers are then paid undisclosed fees by wholesale lenders.

A study released this month by the Consumer Federation of America indicates that woman with above average income and credit scores were more likely to obtain sub-prime financing than men with similar profiles. Households headed by woman, particularly women of color, are unable to realize financial security through homeownership. The historical effects of real estate fraud on society have been disastrous. What about the future?

Within industry circles, there are few signs of a concise and cohesive strategy to reduce real estate fraud on a large scale. The lending and title industries have visibly embraced technology as the means of reducing fraud related losses. Conceptually, the potential for fraud is reduced by tagging individuals and properties as high risk factors based on information contained in data bases.

The high tech model for fraud mitigation results in trendy sound bytes, but its practical application has been ineffective as evidenced by current crime statistics. Accredited business and law schools, recognizing the importance of human nature in fraud deterrence, have approached the white collar crime epidemic from a different angle. To benefit students, the reality of a criminal conviction is dramatically brought to life.

In some cases, students are required to spend a day inside a federal camp. They tour the facility, interact with select inmates and eat prison food. In other cases, white collar convicts are invited to the classroom to talk candidly about the personal consequences of making bad choices. Much is learned about the personalities, behavior and motives of actual fraudsters when students are placed face to face with the insiders to any scheme.

In his book, An Inconvenient Truth, Al Gore wrote We have everything we need to begin solving the crises, with the possible exception of the will to act. An informed and concerned community of consumers is the fraudsters worst enemy! A community based approach to fraud prevention presents opportunities for consumers to avoid exploitation; especially when initiated by industry insiders.

Real estate professionals have a duty to heighten the publics awareness of potential pitfalls. This site is a perfect example of a learning opportunity for consumers. Ultimately, homebuyers are best positioned to recognize fraud and avoid its consequences.

My advice to consumers:

Question anything and everything about a real estate deal that you dont understand;
Avoid situations that demand less than full and honest disclosure to lenders;
If you suspect that something is wrong, it probably is;
Report suspicious activity to authorities;
Reputation, not fee structure, should be the primary factor in choosing a realtor, lender and title agent.

As Gena has so properly stated in a prior article: Experience doesnt cost it PAYS.

Thank you Ed, for your input and helping to educate the public on an issue that affects us all. You are a welcome guest here.

Sacramento Real Estate Voice Honored

What Sellers Need to Know About Receiving Offers

Fraud in Real Estate

Want To Be An Investor?

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What Sellers Need To Know About Receiving Offers

October 16th, 2006 categories: Fraud, Loan Fraud, Real Estate, Realtor, Seller

Lender Fraud In today’s Real Estate market we are seeing quite a few Home Buyers ask for help in closing costs often referred to as recurring, non-recurring costs.

This amount should never exceed 6% (which? is outrageously? generous). Money for closing costs should always be addressed on the first page of the Purchase Contract.

If you receive an Addendum asking for funds to be credited to the Home Buyer, this is probably fraud. The only time that additional monies are ever to be addressed outside of the Purchase Contract are for items found during the Home Inspection process.

Sometimes, the seller would prefer giving the Home Buyer credit at Close of Escrow rather than repairing items found in the Home Inspection or Pest Inspection.

It is imperative that the Home Buyers‘ Lender receive all paperwork having to do with money. Although you have no control over what is sent to the Home Buyers‘ Lender, you should have the knowledge and question the legitimacy of the offer.

If you hired a new agent to represent you it is possible that they are not acquainted with this. Real estate, like in any business, has those to watch out for and those that are honest.

Some agents may send an Offer and an Addendum asking for additional money, be wary of this. Most of us know that at the time of escrow when the monies are tabulated and a HUD statement is generated, these funds would show up. That is not the time that you want to find out that the deal has gone south because of money that the Lender was not aware of. You need to take notice of this at the beginning rather than the end.

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