An Arizona-based mortgage company claims it has been forced to foreclose on 19 homes in the Kansas City, Mo., area because of a scheme involving inflated appraisals, false borrower information and stolen identities. First Magnus Financial Corp. has sued six businesses and 28 individuals, saying it lent more than $2.5 million on houses worth less than $1.8 million, the Kansas City Star reported. According to the lawsuit, all 19 loans have defaulted and First Magnus will lose more than $1 million because the foreclosed properties were not sufficient collateral for the loans. The suit alleges loan officers at Star Equity Funding LLC obtained fraudulent appraisals that valued the homes at $3.1 million. Jane Sanson, doing business as JS Appraisals, and Term Investment Group LLC are accused ...
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