Mortgage Fraud in the Southern District

Mortgage Fraud in the Southern District of Texas

http://www.justice.gov/usao/txs/1News/Releases/2013%20June/130606%20-%20Davis.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams XIV

We've discussed this topic before and at some point I know we will discuss it again.  Mortgage fraud is too pervasive and too important to be limited to a one-time only round.  As stated earlier in this thread, mortgage fraud almost brought down the U.S. economy in 2008.  For most people, houses are the single most important purchase they will ever make in their lives. 

      As with all white-collar crimes, the most important factor in determining whether a criminal act has occurred in intent.  Was there an intent to defraud someone or some organization?  Remember the example we gave in the last post - there is a huge difference between "flipping" a house by buying a house that is in need of repairs, fixing up the house and reselling it vs. conspiring with a group of people to deliberately undervalue the purchase price of a house buy the house for the undervalued price and then resell it.  The word "flipping" applies to both practices, but there is a vast difference in the intent between the two.

     There is always much more to discuss regarding mortgage fraud, but we will leave it at this point for now.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams XIII

     Remember our discussion from the last post - there is a difference between someone who legitimately purchases a property, fixes it up and sells it for a profit.  In this instance, the person is legitimately purchashing a property with the intent to improve it and will sell the property for a (deserved) profit after the improvements.  This is legitimate property flipping.

     Illegal flipping is when a person or, more likely, persons are purchasing a property which has low value but are intentionally and knowingly inflating the price of the property.  This usually involves a conspiracy between the purchaser of the property, seller of the property and the property appraiser.  Sometimes even mortgage companies are involved.  The key here is the intent is to deceive, not to improve.

We will wrap up this discussion in the next post.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Schemes XII

OK - in our last post, we were discussing flipping.

It is important to note that flipping is not in and of itself illegal.  Legitimate real estate investors buy rundown houses, fix up the houses and resell them in a few months.  Flipping IS illegal when the investor knows that the proeprty has been appraised, mortgaged or sold above its market value. 

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Schemes XI

One of the more common types of mortgage fraud, at least during the last property "bust" in the United States is property flipping.

     Property flipping occurs when someone who owns a mortgage broker and/or title company will purchase an inexpensive property, mark it up excessively and resull it to a buyer who is either part fo the scam or an unsuspecting dupe.  In either situation, the buyer will end up defaulting on the inflated loan soon after he takes possession of the property.

     Many "flippers" attempt to work with buyers who are dupes - naive people who are greedy who are looking to make quick money in real estate. 

    We will continue this discussion in the next post.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams X

One of the more basic forms of mortgage fraud is known as "equity stripping."  A major method of equity stripping is adding bogus costs and fees into loan packages. 

    The loan itself may not be predatory or even illegal, but the mortgage broker or another individual or company involved in the mortgage process will add unnecessary or even illegal fees to the actual loan or mortgage.  This "packaging" or "overlay" of these unnecessary fees go straight into the pockets of the fraudsters. 

     Once again, this is another reminder as to why it is important to let an uninterested third party review closing documents.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams IX

As usual, Wikipedia has a good overview of the subprime housing crisis which almost led to the collapse of the American economy.

https://en.wikipedia.org/wiki/Subprime_mortgage_crisis

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams VIII

Quick note - to my Russian readers - I note that for the past week I have been getting more "hits" from readers in the Russian Federation than from the United States.

Spasibo!

     OK - another important aspect of mortgage fraud is always to check out your lender.  A mortgage for the vast majority of Americans is the largest financial hardship they will ever assume in their lifetime.  It only makes sense that before borrowing tens or hundreds of thousands of dollars, you should examine who is lending you this money.  It is one thing if the lender is a large financial institution like JP Morgan/Chase.  It is quite another if it is a local bank that may not have large financial reserves.

     It was pointed out to me not too long ago that people generally examine more closely their purchases of automobiles than their mortgage lenders.  This is a depressing statistic.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams VII

OK - let's continue our discussion about some of the ways to protect yourself from mortgage scams:

1.  Before closing your loan, get a copy of the loan papers with all of the terms and conditions well in advance so you have time to review them.  If anything is different between the loan papers you reviewed and the loan papers that are presented to you at closing, there may be a problem.

2.  Be careful of high points (a "point" is 1% of the loan value.  For example with a $100,000.00 loan one point is equal to $1000.00). 

3.  Don't accept a lender's credit report.  Run your own credit report.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams VI

OK - we have reviewed what are some of the scams used in mortgage frauds.  What are some ways to avoid them?

   Here are a few suggestions:

1.  Before applying for a mortgage, get mortgage counseling.  Such counseling is available from attorneys and CPA's and, for low-income people, from local housing organizations

2.  Ignore high pressure tactics.  As with any kind of investment (and we have covered this before), that pressures you to sign now, now, NOW! is probably questionable at best.  You should always be given the opportunity to have a disinterested 3rd party (such as an attorney) review the documents.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams V

Other hallmarks of a bad mortgage lender or a mortgage that is faulty and/or problematic:

1.  The lender discloses consumer debt information to third parties without the consent of the consumer.

2.  Calling borrowers at work when the borrower told the lender not to make such calls.

3.  Making continuing and annoying phone calls for collections.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams IV

Let's review a typical predatory lending scam:

1.  Materials produced by a scam organization will tell prospective borrowers that if they were to go with the mortgage company the borrower will have lower monthly payments and save money (in other words, the "hook").

2.  Many times clients are told that there are no closing fees or up front costs.  However, unfortunately, many times such costs and fees exist.

3.  Loan fees and closing costs are normally added to the borrowers principal, hence the closing fees and additional costs are hidden.

4.  With some loans, the lower monthly payments are disguised as balloon payments which come into play years down the line.

5.  Extra products, such as extra insurance policies, are sometimes added to the mortgage unknown to the borrower.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud Scams III

OK - let's begin our discussion of mortgage fraud.

One of the more popular types of mortgage fraud, and certainly the one that brought about the most notoriety during the bust years of the late 2000's in the States is predatory lending.

     The basic definition of predatory lending is where lenders (banks, etc.) make loans with illegally high interest rates or fees to uninformed or unqualified borrowers. The borrower is taking out a loan that he does not undestand and cannot repay.  Note that this is a subset of what is known as a "subprime loan" which is another topic altogether.  Subprime loans are not in and of themselves illegal or predatory.  Subprime loans become predatory when they include exhorbinately high interest rates, excessive fees or transaction costs, inappropriate penalties and other types of inexcusable ways to make money.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud II

Before we discuss mortgage fraud, here is a quick overview of what is a mortgage:

http://en.wikipedia.org/wiki/Mortgage_loan

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

Review of Mortgage Fraud scams

We will spend the next series of posts discussing some of the more popular mortgage fraud scams. 

     The effects of mortgage fraud cannot be overstated.  It was the collapse of the housing market that precipated the 2008 crash that very nearly wiped out the American economy.  It is not the purpose of this blog to get into political discussions as to what actually caused this crash.  However, it is beyond argument that fraud was a major component of the development of this crash.

     Unfortunately, mortgage fraud continues today which is the purpose of these postings.

     We will begin tommorrow by discussing the importance of home ownership for the American economy for my international readers.  On that note, I would like to welcome the readers of this blog from Germany.  My stats show that for the first time, I have had more views this past week from a foreign country (Germany) than from the United States.  I normally get a lot of hits from Russia and the UK, so it is nice to know this blog is also attracting readers from Central Europe. 

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

 

 

Mortgage Fraud in the Northern District

Mortgage Fraud in the Northern District of Texas.

http://www.justice.gov/usao/txn/PressRelease/2012/DEC2012/dec21thomas_gregory_mortgage_fraud_sen.html

Please note that their will be no more new posts until after the New Year.  We wish everyone a prosperous and healthy New Year!

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

                                             

Have a great and fraud-free day.

 

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

Indictment for Fraud in the Eastern District

5 Indicted for Fraud in the Eastern District of Texas

http://www.justice.gov/usao/txe/News/2012/edtx-ffetf-william-071212.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Interludes - Mortgage Fraud

Mortgage Fraud in the Northern District of Texas

http://www.justice.gov/usao/txn/PressRel12/lockhart_etal_convictions_pr.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Interludes - Mortgage Fraud

Mortgage fraud in the Southern District of Texas

http://www.justice.gov/usao/txs/1News/Releases/2012%20April/120430%20Trammell.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk