Mortgage Fraud Rises as Sales Decline

Mortgage fraud increased 26 percent in 2008 compared to 2007, according to a study released Monday by the Mortgage Asset Research Institute.

The increase reflects fewer loans. About $1.4 trillion in home loans were made in 2008, down a third from the previous year.

More than 60 percent of the mortgage fraud cases last year were tied to falsified applications; 28 percent reflected falsified tax returns or financial statements; and 22 percent were related to appraisals.

The fastest-growing scams, the report said, are perpetrated by foreclosure prevention specialists, who offer to rescue distressed borrowers, then flee with their money.

The 10 states with the most fraud (in descending order) were:

  • Rhode Island
  • Florida
  • Illinois
  • Georgia
  • Maryland
  • New York
  • Michigan
  • California
  • Missouri
  • Colorado


Source: The Associated Press, Alan Libel (03/19/2009)

Police Arrest Couple in CraigsList Rental Scam

A Las Vegas man claiming to be a licensed real estate practitioner and a female assistant have been arrested and jailed for renting out vacant homes belonging to seasonal residents.

Emilio Gonzales and Melissa Cowan advertised properties for rent on CraigsList. They asked potential renters to sign leases and took security deposits totalling several thousand dollars. Rents were collected in cash at various locations the pair specified.

The scam fell apart when the real owners showed up and found people living in their vacation homes. Police arrested Gonzales and Cowan by following a tenant to the agreed upon spot to pay rent. The two are being held on burglary, conspiracy and fraud charges.

Source: KVBC-TV