Real Estate Scam

The number of suspected fraudulent real estate loan transactions has increased 500% in the past 3 years.

According to the FBI, 80% of all mortgage fraud involves a real estate insider [agent, appraiser, mortgage broker, loan originator, or banker].

• Craigslist Scam. A genuine person posts a classified ad for rental accommodation. The scammer responds, usually in poor English, from a country overseas. They ask for a bit of detail about the property and then usually advise they want to make arrangements with a furniture company to supply the home with furniture as they have limited time. The scammer then sends a check to cover the security and a couple of months rent, and also by mistake sends the amount for the furniture. You are then asked to bank the check and send the amount for the furniture either back to the scammer, or to the furniture company [another scammer or person who will send it to the scammer]. The original check is a fake and if you send the overpayment to the scammer, you will lose it

• Home Improvement Scam. Contractors selling their services tell homeowners that they can get their home improvements financed through a lender that they work with. This is commonly used when the home owner says that they are unable to afford the improvements. A finance plan is drawn up and the home owner pressured to sign quickly before they lose the opportunity. What is not clearly shown is that the loan has high interest rates. Oftentimes, as well as having to pay off a high interest loan, the home improvements are very poorly carried out

• Home Improvement Scam Variation. In this variation, seniors are targeted and forced into signing documents with high interest, with the scammer knowing that they are unable to repay the debt. As a result, their home is taken by the creditor and is left homeless

• False Deeds. This scam involves forged deeds and is the most common type of real estate fraud. The scammers use a false deed to get a loan secured against the property, and then disappear with the money, and leave the owner with a risk of foreclosure by the bank. Sometimes the false deeds are used to sell the property, particularly if the property is vacant, or unused for a lot of the year

• Real Deeds. The deed can either be stolen, or simply taken from the owner. A common way is for the scammer to get some type of authorization, such as a signature, as well as the deed. Then the scammer can do whatever they want without any real risk of being caught. This is a popular scam with seniors where a nurse or family member force them into this situation

• Home Equity Stripping. In this scam, a lender will say it is ok to exaggerate your wealth or income in order to receive a large loan that you can't afford, and then they strip you of it. This allows them to take your home