Just Another Example of Why Some of the "Lender Created Mess" Exists (A Fraud Saga)

Real Estate Technology with Content, coding, marketing, host.

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 would like to buy it but he doesn't necessarily have to. I have no clue where to physically start. I also am not sure what this will do to my credit report as I am unemployed for a couple more months. Twist: The condo was purchased with plans to rent it out (although that's not what we told the bank-I was to live there), we got it at a low rate fixed for 5 years(almost up). Now they somehow know that I don't live there-the fact that I'm now living out of state must have tipped them off-and they won't let me refinance due to it being a rental. My father who was handling the condo is currently in Iraq and wanted me to research short sales. Your video was the first I saw after reading a few websites. Who exactly do I need to contact in preparation, what will this cost me, do I need to go back to the state the condo is in, will this kill my credit rating, and what else am I over looking? Will this be worse than just selling the condo to my dad? If you have time, i'd appreciate any advice you can give.


Well Emillio, you're lucky you're not in jail, yet, for committing mortgage fraud. Glad to see you're caught but look what you've done to the economy surrounding your condo. Yes, Emilio, your credit will stink because you've already missed payments. If I were the bank I'd call it due since you violated the terms of the loan agreement by lying on your application.

Why don't you try Googling "sentenced for mortgage fraud" and get back to me.

What I am saying is that all of this mess is not atributable to even the lowest of the low mortgage lenders including Homeowners, Argent (AmeriQuest), ABN Amro, and other country wide lenders. Some heads still need to roll.

Let's revisit the types of mortgage fraud:

Fraud for Profit - flat out I'm stealing money
Fraud for Shelter - I can't see any other way to steal a home
Fraud for Criminal Behavior - I need some place to grow my weed

Fraud for profit - top two methods: false statements on application (I intend to occupy this home as my primary residence) or providing false documentation to prove false statement on the application

Have you heard? Black Belt Real Estate Training is coming soon.

Posted by

Web/Social Developer For Hire - I code. I create. I manage. Whether you need your website to actually do something other than look pretty or one of the following services let's talk. Anyone can make a beautiful WordPress site (all the hard work is done) but few can make it work for you. , blog content, research intense reports, data reports (and accompanying charts and graphics), ebooks, presentation content, speeches, social media management, advertising scripts, or similar, let me show you what you can have.

Listen to Social Media Edge Radio weekly for powerful tips on making the Internet pay for you. Blogging, social media, and web technology with some of the most successful and well-known guests on the Web!

I started writing on Active Rain in 2006 when I was representing the mortgage industry. I am no longer in that industry and many of the older posts contain outdated information. Please do not contact me for LENDING or MORTGAGE questions but rather contact a licensed mortgage professional from your area. I have always been in marketing and branding and that is still what I do. Thanks for reading!


This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
mortgage fraud
occupancy fraud

Spam prevention
Show All Comments
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

This is priceless.  Sounds like the lady who called me a few days ago to list for short sale on of her 5 investment properties.

I was explaining the "hardship" requirement and she said, "Oh, I have a hardship.  I'm getting divorced".

This market is a lot more fun, although probably worse than in 1990.  The "remedies" dreamed up by the government are a pot full of laughs.


Aug 01, 2008 05:41 AM #1
Flemington, NJ

You are right, the poor me, poor me people now often are  the folks who tried to put one over on the sytem. 

Aug 01, 2008 05:43 AM #2
Steve Graham
Inactive - Atlanta, GA

If I am not mistaken, many investment gurus encouraged this type of misrepresentation to lenders; it was a way to get better mortgage terms.

In this society, twisting the truth is not considerd a lie. God help us!

Aug 01, 2008 05:45 AM #3
Travis Newton
Salem and Bend Oregon FHA, VA & USDA 503.931.4490 - Salem, OR

I 've had 2 very similar e-mails and calls in the last 2 months.....Sad

Aug 01, 2008 05:46 AM #4
Renée Donohue
Savvy Home Strategies Realty, LLC-REALTOR®-Estate-Probate - Las Vegas, NV
Las Vegas Real Estate Broker - www.urLVhome.com

Actually this type of activity has really hardened my heart to those "poor me" types who are probably just out there in normal numbers when you take out all of this NOO and stated abuse.

I really WISH more can be done about this!

Aug 01, 2008 05:52 AM #5
Michael Wayne Jackson
Coldwell Banker - Novato, CA
Realtor - Senior Real Estate Specialist

Great post Ken. I can't see any bank approving this as a short sale.

Aug 01, 2008 05:55 AM #6
Bryant Tutas
Tutas Towne Realty, Inc and Garden Views Realty, LLC - Winter Garden, FL
Selling Florida one home at a time

Ken, It seems like most of the folks I talk to about short sales "Planned on moving to Florida but things changed so now I need to sell my house". Same story different day.

Aug 01, 2008 07:07 AM #7
Gene Wunderlich
1st Action Real Estate - Murrieta, CA
Realtor & Legislative Liaison

Forget who it was said 'now that the tides going out you can easily tell who was skinny-dipping'. I'm seeing more and more of this as people try to short-sell only to be caught up in the web of lies they told to get into the home in the first place. Then they expect us to lie on their behalf to get them out. Yeah - that could happen.

Aug 01, 2008 11:09 AM #8
Joan Mirantz
Homequest Real Estate - Concord, NH
Realtor, GRI, CBR, SRES - Concord New Hampshire

When all of this is over...how ever many years from now that may be...I hope they are able to put out statistics on who has the most blame. It would be very interesting!

Aug 01, 2008 11:19 AM #9
Sharon Paxson
Arbor Real Estate - Newport Beach, CA
Newport Beach Real Estate - Arbor Real Estate

Non owner occupied  . . . interesting post! It amazes me what people will try and get away with.

Aug 01, 2008 01:08 PM #10
Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

You plays the game, you takes your chances...  I've gotten a bit hard in the heart about a lot of these people as well. 

Aug 01, 2008 02:40 PM #11
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?


Ken Cook

Content Marketer/Creator
Ask me a question
Spam prevention