$750K mortgage fraud too sweet to pass up

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

Weak housing markets appear to encourage mortgage fraud. Typically, fraud associated with home purchases requires multiple perpetrators, one of whom is the ringleader. While a lender is always the victim, another lender may be involved as a perpetrator. An appraiser, home seller and home buyer are always involved, perhaps innocently, perhaps not. Here is a great example provided by one of my readers. He had his house listed for sale for six months with no takers at the list price of $700K, reduced from over $800K, and finally took it off the market. Shortly thereafter, he received a letter offering him $675K, contingent on his getting an appraisal for $750K. (The letter-writer was the ringleader in this case.) The homeowner did get an appraisal for $750K, perhaps because of his high asking price earlier, and the tendency for appraisals to lag the market. The ringleader explained to the homeowner how the deal would go down. The critical factor was 100 percent financing for the full ...