FBI Reports Housing Scam Activity Increasing - Doubles in 2007
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With the decline in most housing markets, previous housing scams are coming to the surface just as new ones are being concocted taking advantage of those who are in financial trouble. According to the FBI housing and foreclosure scams have doubled in 2007 and they expect the trend to continue.
The FBI expects more foreclosure scams as criminals prey on growing numbers of people desperate to keep their homes while interest rates balloon on adjustable rate mortgages, Ormsby says. She also expects increasing fraud in “reverse mortgages,” in which homeowners 62 or older can take out a loan against the equity in their home. Unlike a traditional home-equity loan, the borrower doesn’t pay back a reverse mortgage until they sell the home.
Ormsby says the FBI’s mortgage fraud cases have focused for years on fraudulent documentation of assets and property flipping crimes, in which buyers purchase cheap homes, have them falsely appraised at a higher value, then sell them at the inflated price.
Housing advocates and public-interest lawyers say federal law enforcement and regulators have focused too sharply on property flipping, and not on companies that defraud consumers by steering them to high-interest loans or by issuing deceptive contracts. via USATODAY.com.
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Comment by AZ Foreclosure Realtor on 14 January 2008:
Yup, exactly right. Money is tight, people start acting desperate. The scam artists come flooding in, and those who normally are with high integrity, suddenly become vultures in order to pay their bills. 2008 and 2009 will have some ground breaking court cases incarcerating major investors for shady activity. It’ll be interesting.
Pingback by Do You Allow the Market to Control You? - on 14 January 2008:
[...] UPDATE- Read this article for more information- FBI Reports Housing Scam Activity Increasing - Doubles in 2007 [...]
Comment by Robert Coté on 14 January 2008:
Bull, the FBI has not been pursing fraud in the past. this is all talk. The Sacramento, Los Angeles, West division, and National offices of the FBI were contacted last year from every walk of life from all over the world including people with direct personal knowledge and from people in other Federal enforcement branches about one person and their fraud activities. To date Casey Serin is free. The FBI is lying in the lame hope that idle threats will keep people from committing crimes it knows it is powerless to pursue.
Comment by Paul on 14 January 2008:
I don’t believe this for one second. Empty threats to try and stop this from happening.
Comment by Brett Wilson on 16 January 2008:
Does anybody have a copy of that FBI report or a link. I would like to get my hands on it, I want to see facts, numbers,where that study was conducted?, what year? how many homeowners(victims)participated in that study. As far as I”m concern there is always going to be scammers…and victims (don’t hate me for what I’m about to say)How many of these people really did not know what they were signing? Hello!! isn’t legal aid services available in almost all the states? Come on…. somebody got to take the fault and now its the scammers turn.
Comment by SellQuickForCash on 22 April 2008:
It is a shame that there are individuals or companies out there that take advantage of desperate homeowners situations for profit. There are plenty of ways to make money as a real estate professional in todays declining (foreclosure heavy) market and maintain ethical, above board business practices. At http://www.SellQuickForCash.com we pride ourselves on our experience with foreclosures and short sales and the fact that each day we educate homeowners on their situation and the options available to them. We are glad to see that the FBI is counteracting these scams…it makes the rest of our jobs easier in the long run!
Cody S.
http://www.SellQuickForCash.com