How Mortgage Fraud is Infiltrating MLS Data
Mortgage fraud is a problem that is increasingly coming to light in the marketplace. The fraudulent data is also in the MLS data that real estate agents need to properly do their job and these distortions can hurt buyers and sellers as much as the mortgage companies. The article this morning in the Miami Herald explains why.
But real estate agents say they are sometimes asked to raise the list price of a home. In mortgage fraud cases, that allows a broker to pay the seller at the original list price and keep the rest of the money as cash back at closing.
The false sales information means other sellers can end up overpricing houses that then get stuck on the market, and other buyers can end up paying more than they should.
”The average person in a neighborhood full of fraud is paying higher taxes because of an artificial base — they’re paying more because somebody cheated,” says Nancy Hogan, a member of the Florida Real Estate Commission, a state licensing board that has no authority over the MLS. “On the other hand, when those houses go into foreclosure, they are also bringing down the neighborhood.” via the MiamiHerald.com.
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[...] than just affecting the lenders, these illegal deals will fool sellers into listing too high, and potentially cost them thousands of dollars as real prices decline even further. Would you [...]