{"id":2013,"date":"2015-08-01T00:20:19","date_gmt":"2015-08-01T04:20:19","guid":{"rendered":"http:\/\/dankrell.com\/blog\/?p=2013"},"modified":"2021-11-23T17:31:31","modified_gmt":"2021-11-23T22:31:31","slug":"mortgage-fraud-persists-and-is-local","status":"publish","type":"post","link":"https:\/\/dankrell.com\/blog\/2015\/08\/01\/mortgage-fraud-persists-and-is-local\/","title":{"rendered":"Mortgage fraud persists and is local"},"content":{"rendered":"

\"mortgage<\/a>Mortgage fraud persists and may never go away. Frankly it seems as if the fraudsters are becoming increasingly creative and brazen. The 2014 LexisNexis\u00ae 16th Annual Mortgage Fraud Report<\/a> (lexisnexis.com) seems to agree with the sentiment, saying: \u201cThe reduced volume of consumers who are able to qualify for mortgage loans has led to a fiercely competitive and, in some ways, familiar Fraud for Profit marketplace\u2026 Ultimately, fraud and misrepresentation, especially in the mortgage application process, is likely to remain a serious and ongoing national problem.\u201d<\/em><\/p>\n

Looking into why mortgage fraud persists, the LexisNexis\u00ae Mortgage Fraud Report indicated that 74% of reported loans in 2013 involved some form of application fraud or misrepresentation. The increase included the misrepresentation of credit information, including credit history and references. Appraisal fraud was reported to be at a five year low; which is most likely due to the implementation of the appraisal Home Valuation Code of Conduct that reformed the relationship between the lender and the appraiser.<\/p>\n

Mortgage fraud persists throughout the country. Although the LexisNexis\u00ae Mortgage Fraud Report ranked Florida and Nevada number 1 and 2 respectively for mortgage fraud during 2013, don\u2019t think that other regions are immune from scammers and schemers. Mortgage fraud can pop up anywhere.\u00a0 For example, I am local to the Maryland area, which is ranked 9th<\/sup> in mortgage fraud<\/a>; which has a Mortgage Fraud Index of 110, that indicates there was more fraud than would have been expected from the number of mortgages originated.<\/p>\n

Mortgage fraud persists and is local.<\/h3>\n

A July 21st<\/sup> news release from the Maryland District of the U.S. Attorney\u2019s Office (justice.gov\/usao-md) reported that a Bethesda MD man pleaded guilty to conspiracy, wire fraud, and aggravated identity theft that stemmed from a mortgage fraud scheme<\/a>. The scheme defrauded lenders to the tune of $3.8 million by using the names of immigrants and students, as well as false financial information, to buy almost three dozen row houses in Baltimore \u2013 all are in default or foreclosure.<\/p>\n

The scheme used \u201cstraw purchasers\u201d to purchase the homes. The defendant told them that he would prepare mortgage applications, manage the property after purchase, and promised 80% of proceeds of a future sale. Besides paying the straw buyers cash after buying homes, the defendant also paid them for referrals of other potential straw purchasers.<\/p>\n

In another case, a former Maryland real estate agent was recently sentenced to 57 months in prison<\/a> and ordered to pay $2,482,856.05 in restitution for conspiracy to commit wire fraud and aggravated identity theft that stemmed from a mortgage fraud scheme. According to a March 31st<\/sup> news release from the Maryland District of the U.S. Attorney\u2019s Office, the defendant and his co-conspirator help straw buyers obtain mortgages by \u201cusing stolen or false identities, false documents \u2013 including W-2 forms, earnings statements, and bank statements \u2013 and false credit information…\u201d Straw buyers\u2019 credit worthiness was fraudulently enhanced by creating fictitious lines of credit. The scheme also included inflated appraisals and false contract addenda to direct payments for repairs that were never made.<\/p>\n

And it\u2019s not just the usual suspects who are the perpetrators. The MERS scandal that erupted in 2010 not only let us see behind the wizard\u2019s curtain of mortgage lending, but it also brought to light the notion that mortgage fraud can occur at any level. An asset manager, of a commercial mortgage special servicer located in Bethesda MD, pleaded guilty<\/a> to wire fraud \u201cin connection with a scheme to steal over $5 million from his company,\u201d according to the Maryland District of the U.S. Attorney\u2019s Office. The April 22nd<\/sup> news release described how he redirected funds intended to be applied to defaulted commercial mortgages.<\/p>\n

Original published at https:\/\/dankrell.com\/blog\/2015\/08\/01\/mortgage-fraud-persists-and-is-local\/<\/p>\n

Copyright \u00a9 Dan Krell
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\nDisclaimer<\/a>. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.<\/p>\n","protected":false},"excerpt":{"rendered":"

Mortgage fraud persists and may never go away. Frankly it seems as if the fraudsters are becoming increasingly creative and brazen. The 2014 LexisNexis\u00ae 16th Annual Mortgage Fraud Report (lexisnexis.com) seems to agree with the sentiment, saying: \u201cThe reduced volume of consumers who are able to qualify for mortgage loans has led to a fiercely … <\/p>\n

Continue reading “Mortgage fraud persists and is local”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[118,120,13],"tags":[862,797],"class_list":["post-2013","post","type-post","status-publish","format-standard","hentry","category-fraud","category-mortgage-fraud","category-real-estate","tag-mortgage-fraud","tag-real-estate"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p1VZLf-wt","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/2013","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/comments?post=2013"}],"version-history":[{"count":9,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/2013\/revisions"}],"predecessor-version":[{"id":6359,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/posts\/2013\/revisions\/6359"}],"wp:attachment":[{"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/media?parent=2013"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/categories?post=2013"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dankrell.com\/blog\/wp-json\/wp\/v2\/tags?post=2013"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}