FBI Reports Mortgage Fraud Rampant N.Y. In Top 10

 

FBI reports mortgage fraud up 35%

Today http://www.reuters.com/article/bondsNews/idUSN0751853920090707 the FBI reports that “insiders” in the mortgage lending industry are frequently engaging in mortgage fraud.  And with the Obama’s infusion of cash to assist the ailing industury, its the taxpayers who will be footing the bill. The FBI has an interesting site which defines the white collar crime they fight see http://www.fbi.gov/publications/financial/fcs_report052005/fcs_report052005.htm

The increase in mortgage fraud is up a full 36 % http://www.mortgagefraud.org/ which indicates the industry similar to Wall Street is not regulated with enough policing to deter the behavior. Mortgage Fraud is generally a misrepresentation of material facts in the purchase of real estate ( employment, income job status, credit score, past credit history, assests) and or an omission in these facts. Frequently persons in the fraud business have allies such as appraisers who falsify the value of the property. ( some cases with false pictures of the premiese which turns out to be burnt out or gutted and worthless.) See http://en.wikipedia.org/wiki/Mortgage_fraud

House Appraised with Value is a Sham

Today’s Wall Street Journal http://online.wsj.com/article/SB124631486277570583.html in an Op-Ed reports that many of the housing and mortgage woes are also the result of declining prices and no recourse loans, which allow consumer’s to walk away from a mortgage with ease and rationality when the value of the asset drops below the market value.  Fraud is a component of this as mortgage brokers often fabricated the assets and credit history of a borrower to induce the lender to make a loan. I found one blogger who actually covers this topic full time http://www.mortgagefraudblog.com/ and it’s amazing all the scams, identity theft and fraud that is ongoing.

Another component of the industry leading to fraud is that mortgage lenders, brokers, salesperson and their staff are not supervised, regulated, trainned or certified. The industry is replete with convicts , hooples, low lifes and frequently staffed with criminals. See http://www.thedenverchannel.com/news/9192064/detail.html.  Many mortgage brokers act in a ponzi like manner and they have a big incentive commisions can range up to 3% for a loan, as such a broker with a $300,000.00 mortgage deal makes almost 10 grand for submitting paper.  Oringination fees are one way they proffer http://mortgage-x.com/library/br-ty pes.htm their income. As the FBI reports as the housing industry has collapsed these lowlifes are now seeking to maintain their pimp status by engaging in criminal fraud.  They use to be called predatory lenders, now we can call them what they are criminals. ( for an example see http://www.nhi.org/online/issues/109/bradley.html)

 A great site before you purchase a home the gives you the real deal on mortgage brokers ( some good) and banks is the mortgage professor. http://www.mtgprofessor.com/default.htm New York not suprsing is in the top ten for states with mortgage fraud. http://weblogs.newsday.com/realestate/blog/2009/07/ny_in_top_10_states_for_mortga.html