mortgage fraud: Yes, That's Mortgage Fraud and Probably Tax Fraud, Too! - 06/02/09 01:06 PM
People THINK! If your income was too low for the previous year according to your tax returns DO NOT FILE AN AMMENDED RETURN just for the sake of making your income appear higher. (A) that is mortgage fraud and you will be caught - just like we caught the lady today and (B) it may be tax fraud. I don't care if the local Sherrif, your real estate agent, or the underwriter at the lender told you to do it.
Normally when someone comes to us from 2 previous lenders and "have no idea why the loan would not close" and … (4 comments)
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mortgage fraud: What Every Borrower MUST Know About A 4506-T - 01/29/09 01:28 PM
Several months ago most lenders started requiring the completion of an IRA form 4506-T in every loan submission package. Not too long afterward I had an applicant in my office signing documents with a Loan Officer when the LO came into my office and said, "They do not want to sign this 4506-T."
A 4506-T is a request for copies of tax filings from the IRS for the most recent 3 years of tax transcripts to prove the applicant filed and that the numbers match what the applicant provided at the time of application.
When I asked the applicant why they … (7 comments)
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mortgage fraud: World's Biggest Dollar Scam? The Proof of Funds Racket, Perhaps - 09/10/08 04:12 PM
It started years ago and it still continues. An agent comes to me with a client who has a POF letter from a "real bank". Usually a foreign bank and usually $10,000,000 to $100,000,000 is mentioned.
Their real value? Not even tissue paper - and that's putting it nicely.
If you are reading this and you know me and you have been offended by my response - too bad. I make no apologies for my treatment of people who waste my time by approaching me with a POF letter or even a Letter of Credit drawn on a bank in which … (5 comments)
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mortgage fraud: "MARI: 1Q Mortgage Fraud Up 42%" Duh, Really? - 08/27/08 04:18 PM
I think I was I who said, "we'll have less sales and refinances and more fraud" in reference to changes in the lending environment. Trust me - I'm not making excuses for these scumballs and thugs - it's just common sense. Make the dream harder to acheive and people are going to take more risks and break more rules (and laws) to acheive it.
According to a report in National Mortgage News "Florida led the states in mortgage fraud, accounting for 24% of all properties with material misrepresentation for loans originated in the first quarter, according to the MARI Quarterly Fraud … (12 comments)
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mortgage fraud: Just Another Example of Why Some of the "Lender Created Mess" Exists (A Fraud Saga) - 08/01/08 12:37 PM
I regularly receive emails from people asking for my assistance with short sales, loan modifications, etc. Since I'm a "real" loss mitigator and not one of those blue light special "I bought my *certification* with $1500 and a class" variety ... but I digress :)
Today I get this email:
hi, I'm just now hearing about short sales and am completely confused. I'm not at all educated in all of the terminology and rules and laws of real estate. In a nutshell: I have a condo with under $100k left on it. My father is on the title with me. He … (11 comments)
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mortgage fraud: What Fraud Proliferates Our Industry? - 07/29/08 03:39 PM
First let me say I'm not accusing these people of fraud. But let me continue that statement after you see some of these links:
Do a search, I dare you:
"seasoned tradelines"
I love this one - "How To Establish Multiple Credit Files With The Equivalent of a 720 FICO For Each Entity" - http://www.trafficnetworkcentral.com/
What is this they are doing now?
In the mortgage banking industry we determine everything about a loan based on risk. If risk is misrepresented or a level of risk is manufactured for the specific purpose of modifying the appearance of risk to the lender we … (6 comments)
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mortgage fraud: Occupancy Fraud, We're Watching You - 02/07/08 05:40 PM
It used to be the number one form of fraud: a buyer saying they intended to occupy a property when they never did.
If you don't know why an applicant would state they intend to occupy a property when they know they are purchasing it as an investment it has everything to do with being able to qualify for the loan. Lender guidelines for owner occupied properties are much less stringent than they are for non-owner occupied properties. Risk to the lender is much higher on investment properties therefore the gauntlet to approval for an investment loan is tougher than it is … (11 comments)
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mortgage fraud: Credit, Pay Stubs, 1040's and Bank Docs: Fraud For Sale - 01/01/08 07:51 PM
It used to be big, then stated income for W2'd employees came along and it slowed down. After ADT sued Novelty Pay Stubs dot com it slowed down even more. HINT: It's coming back. It took less than 5 minutes to find just the solution at http://www.fakepaycheckstub.com/ where I can purchase the software and not only do it myself but help my buddies out, too.
The conclude with "if you are looking for fake pay stubs or fake payroll stubs then we have the fake cheque stubs and fake ids for your entertainment needs"
So who owns it? I don't know ... yet. Their … (10 comments)
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mortgage fraud: Finally! As An Industry We Are Stopping Cash Back At Closing on Purchase - 11/27/07 01:48 PM
I have shouted for years about the fraud of cash back at closing on purchase and huge third party payouts to "bird dogs", "locators" and "consultants". Finally, INTERTHINX, a fraud detection and deterrence investigations company I am glad to call "my friend".
You may have read my exchange with a certain real estate agent from Corpus Christi last year. He was rude, absurd and threatened me. I sent him my home address, my home phone number, a picture of my house and a Google Map to my driveway. That was June 2006 - I'm still waiting Carlos!
Anyway, I digress.
Here is what I … (4 comments)
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mortgage fraud: Occupancy Fraud - Back On The Top of The List - 10/12/07 02:58 PM
For the past few years overstated value and overstated income ruled the roost for mortgage fraud. Our old friend occupancy fraud took a back seat but is now climbing the charts.
What is occupancy fraud? This occurs when a buyer indicates they intend to occupy the subject property as their primary residence and never have any intention of doing so. Be careful, many times the loan officer may suggest you do this - it's still fraud and it's still you signing the documentation. If you can't understand why this is fraud let me kind of explain it in very elementary terms.
Lending … (0 comments)
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mortgage fraud: What Is A "Straw" Buyer? - 09/11/07 04:55 PM
Sometimes we use terms familiar to our own little clique but confusing or misunderstood to others. There is one term in particular we hear in my business somewhat frequently that is obviously misunderstood by many. The term I am writing of is "straw buyer". This blog has a dual purpose and that is to define the term and briefly explain why it is a problem and even illegal.
Here is a straw scenario for you and it is very often used by people who just can't seem to understand how it can be a problem. Let's say you find a lovely new … (36 comments)
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mortgage fraud: Cash Back At Closing, Why It Is Fraud, Why "They" Will Be Looking For You - 09/06/07 04:25 PM
It used to be a hot topic and with the tight market in some new areas you will see it popping up in more places. Because of my articles on this topic I have had my well being threatened (by a Bee/Wax agent from Corpus Christi), people have called my office and threatened me, I have had the most interested emails you could imagine, yet here I am ... still beating that drum! Dare you read on?
Texas and Florida seem to be the most inundated although I am beginning to see more of this in Georgia. You've seen the ads, they … (11 comments)
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mortgage fraud: How Will Anyone Ever Know? I'll Tell You ... - 06/12/07 08:25 AM
So it's just a little "gray" area that will never harm anyone. Maybe I'll just let it slide so I can get the commission from this deal. After all, how will anyone ever know?
For those of us serious about eliminating fraud and mitigating the damages to our industry and indeed our nation a statement like that is a Call To Action. Younger ones may have a more difficult time controlling their zeal when explaining how gray is not harmless and how it is just that attitude of letting things "slide by" for the sake of a paycheck that help perpetuate real … (7 comments)
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mortgage fraud: Next to fall: Cash Back and Private Mortgages - 05/10/07 05:49 PM
Every time the game changes the players just change jerseys and get back on the field. There is a LOT of hype and talk about Cash Back At Closing (from a conventional loan any cash that goes back to the buyer from the SELLER's proceeds) is mortgage fraud. Period.So how are people getting around it?
Some are adding in "marketing fees" that just kind of disappear after the closing. Many are using "shell companies" which are easily sniffed out. A few are having the listing agent jack the listing fee to 10, 12 even 15% and kicking back out of the "broker's … (3 comments)
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mortgage fraud: Fraud Spotters: Cash Back At Closing Defined (Builder Kickbacks?) - 03/07/07 10:50 AM
I have noticed there are some misunderstandings about which cash back at closing is fraud and which is not.
Teri Eckholm recently blogged "Mortgage Fraud - Important Reminders for Buyers, Sellers and Agents" and one of the comments from Neal Bloom which included "jack up the price so that the buyer can get the seller to contribute towards closing costs"
Let's clarify something here: If, during the negotiations for the transaction, the buyer asks the seller if they will contribute the lender allowed closing costs to close the deal and the seller says "yes, if you will pay (for example) $206,000 instead of … (14 comments)
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mortgage fraud: Increase Credit Scores 200 Points in 30 Days: Legal? Ethical? You Decide. - 02/07/07 03:29 PM
Okay, enough already. So I get the emails all the time. Usually I simply ignore them and mark them as spam so future editions go straight to the dump. But this morning I just wanted to ask, "Explain how this is not defrauding me."
I thought you may enjoy the exchange:
Dear KenDo you or your clients need seasoned trade lines / aged credit to boost their credit scores?COMPANY NAME, Inc. can help.COMPANY NAME is an exclusive network of businesses and individuals with prime credit that have joined together to benefit you & or clients.With our Seasoned Trade Lines, you can instantly have … (5 comments)
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mortgage fraud: Mortgage Fraud Pop-Quiz - 01/17/07 09:33 AM
We did this before and it was great fun. And we all learned from it so I thought I would do it again. Select the best possible answer for the following statements or questions:
1. The ad reads, "Get Paid For Your Good Credit! Investor with massive assets needs to purchase 1000 homes in 30 days. All you need is a middle credit score of 680 or higher, ability to document your income and assets, and I will pay you $20,000 for each deal."(A) As long as the person with the good credit knows about the deal there is nothing wrong with … (1 comments)
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mortgage fraud: These Generally Raise Fraud Flags (or badges) - 01/16/07 05:56 PM
These are FLAGS which raise suspicion during the Quality Control procedures of any loan. Today, more than ever in any times past, lenders are examining every acquisition and refinance loan under the proverbial microscope. There are power automated fraud detection systems such as DISSCO from Interthinx, AppIntell from GHR Systems, Falcon Fraud Manager from Fair Isaac and many more. While AFD systems such as these are not infallible they greatly decrease the amount of time required by a Quality Control officer by compiling data from several different resources into one location.
Novation Mortgage uses the DISSCO system which provides cross referenced information … (2 comments)
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mortgage fraud: Starbucks has nothing to do with Mortgages - 10/27/06 09:22 AM
Sorry Jeff! I had to do it ...
If you were invited to a jaliggy (a great and wonderful picnic type party with music, games, food & drink) because they were giving away a new Cadillac to everyone who showed up you'd probably be highly interested in going. However if you read the fine print that says a jaliggy starts out by everyone (who ever was late on a payment and cannot bring proof of income and assets for the last two years) driving a nail through their big toe you wouldn't (unless you are extremely odd) be nearly as interested in … (25 comments)
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mortgage fraud: Another Answer on Cash Back At Closing and Discount Brokers - 10/15/06 10:23 PM
If you've followed my blogs here on Active Rain and other places you know one of my favorite past times is uncovering and addressing mortgage fraud. Sometimes it's done through simple education before the fact. Other times by turning over evidence to the authorities. I had another real estate broker with whom I work regularly and is a member of one of the professional associations with which I am affiliated about cash back at closing.
It was a trick question ... sort of. Here's the "evidence" http://www.sellorbuyahome.com/buyopt.htm
This is strictly from my own perspective as Director of Operations at Novation Mortgage, where I … (7 comments)
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