Mortgage Fraud Continuing to Take Victims
Fraudulent Mortgage Applications
Increase in Home Mortgage Scams
A yearly report by the FBI reveals that mortgage fraud continues to be widespread, in part because perpetrators stand to gain huge profits with little risk of getting caught. The report concludes that mortgage fraud scams are hard to uncover; the total cost of these scams isn’t known, although one real estate firm CoreLogic estimates more than $10 billion in loans were made with fraudulent application data in 2010.
Being Aware of The Scams
The FBI predicts that con-men will keep seeking new methods to skirt loopholes and gaps in the mortgage lending market. The stagnant housing market has proven to be a fertile ground for scammers, with mortgage fraud increasing by 12 percent year-to-year between 2009 and 2010.
The most common scams include falsifying financial information to qualify buyers who otherwise would be ineligible for a loan, inflating appraisals to sell San Antonio new homes at elevated prices, and convincing investors to buy rental property or land because the price will quickly increase in value.
The FBI Are Fighting These Crimes
According to the FBI, mortgage crimes are committed by a range of perpetrators: licensed and unlicensed brokers, loan officers, real estate agents, housing appraisers, and others who exploit the system. The FBI indicates that in some cases, organized crime organizations are behind the fraud schemes.
The states hardest hit by mortgage fraud in 2010 were California, Florida, New York, Illinois, Nevada, Arizona, Michigan, Texas, Georgia, Maryland and New Jersey. Although in Texas there are programs available with no money down homes to help buyers avoid the mortgage fraud. To fight the ongoing fraud, the FBI launched Operation Stolen Dreams in June 2010, which targets mortgage fraud throughout the country.