I found an article today in the "Ohio Realtor"magazine that really struck a chord. The reason being is that even in a smaller community such as Preble County, ANYBODY can fall victim to scam artists; especially people who might be in hardship and feel they have nowhere else to turn.
This article was regarding scams surrounding short sale properties; those homes where people owe more on the house than what it is worth in today's market. The scam has a nickname..."flopping". Here's what the article, written by Peg Ritenour, VP of Legal Services of the Ohio Association of Realtors, had to say...
"The following is an example of what Freddie Mac considers short sale fraud:
- An seller owes $100,000 on his mortgage, however, the property is only worth $80-85,000.
- An investor approaches the seller with an offer to purchase at $70,000. The seller authorizes the investor to begin short sale negotiations with his lender, sometimes even giving power of attorney to the investor.
- The investor places the property on the market.
- The investor finds a "purchaser" and enters into a contract to sell to this "end buyer" for $95,000.
- The investor negotiates a short sale with the lender, obtaining approval of his contract for $70,000 by convincing the lender that this is the highest price the market can support.
- The investor does not disclose his contract to sell the proerty to the "end buyer" for $95,000.
- Both transactions close on the same day with the investor netting $25,000."
"...in addition to civil action for such fraud, this type of conduct can also potentially result in criminal actions".
Think this isn't something that can happen in such a rural community as Preble County? Think again. It's happening as I write this. Folks all over this county, faced with tough decisions about their homes, are being scammed left and right. Whats more important to mention is most cases...a Realtor is not involved.
The lesson to be taken from this? Please consult with an ATTORNEY!!!. Then, get a licensed Realtor to give you current, objective information on your home, its value, and the options that might be available to you.
Losing your home is a scary enough prospect to have to face. Please don't let a scam artist make it worse.
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