CNBC On Upfront Fee Loan Modification / Foreclosure Rescue Scams
For the video (6:23), see Fraud At Your Front Door (or go here for a summary of the report).
Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
For more, see Miami-Dade may pay 3 who were denied rent subsidies (County commissioners are expected to vote Thursday to settle a lawsuit seeking to restore rental benefits to three needy local residents).
For more, see Feds may foreclose on Fairhope apartments (Problems over back rent at federally subsidized complex date from late 2007).
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For other stories on Federally subsidized tenants allegedly cheating the government out of housing assistance payments, see:
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For a story of three Miami, Florida women who sued the Miami Dade Housing Authority for allegedly stripping them of their housing benefits after accusing them of lying about their qualifications for housing entitlements, see Dade commissioners to vote on $60K housing settlement.
(1) Reportedly, the trouble over back-rent began in late 2007, when the managers of Spring Run Apartments began using the federal government's Earned Income Verification system. Using a tenant's Social Security number, a housing manager can find the income reported by that person to the Internal Revenue Service the previous year. If discrepancies are found, the tenant must be charged for the rent that would have been paid if accurate income information was provided. The property managers' inquiries using IRS records discovered that the occupants of more than 30 of the Spring Run complex's 50 units had under-reported income in the previous year and now owed back rent, the landlord said. But instead of paying the bills, many tenants left without notice.
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Among the new rules:
For more, see New rules raise the bar for condo mortgages in Florida (In a move that will make it even more difficult to qualify for a condo loan, Fannie Mae is putting a host of new conditions on mortgages for condominiums in Florida).
In another new Fannie Mae rule, which reportedly applies nationwide, buyers qualifying for a mortgage loan conforming to Fannie Mae guidelines who fork up less than a 25% downpayment will be clipped for an additional 3/4% fee (see Fannie Mae's added fee to crunch condo buyers).
(1) According to the story, the new rules come at a time when condo buyers already face difficulties getting mortgages. Many banks over the past two years have dramatically pulled back on condo lending, requiring down payments of up to 40 percent in new buildings. Some lenders even have blacklisted condo buildings, citing a high risk of price declines and defaults.
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For more, see Mistrial declared in fraud trial (Crown doesn't buy suspect's argument).
Go here for related posts on this story.
(1) Reportedly, The Crown claims McLellan fraudulently registered a $160,000 mortgage against the home of one of his employees without the knowledge or consent of that employee. McLellan was arrested in September 2006 and has been out on bail ever since. KappaDeedTheft
Source: Pipes at apartment building burst, force out residents.
Go here for more on freezing pipes in vacant homes. frozenpipetheta ForeclosureHomeVacantBeta
Source: Frozen Pipes Cause Problems In Vacant Homes.
See also, The Columbus Dispatch: Weather has pipes bursting (Frozen lines common as vacant homes increase):
Go here for more on freezing pipes in vacant homes. frozenpipetheta ForeclosureHomeVacantBeta
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For more, see Vacant house burns to ground; arson suspected.
For other stories on fires & foreclosures, go here, go here, go here, go here, go here, and go here. ForeclosureHomeVacantBeta
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For more, see Finance director at St. Paul church charged with embezzling $37,000 (Family was having financial trouble, priest told cops).
For more, see MT foreclosure scams becoming more frequent.
Source: Police Blotter - Burglaries.
For more, see Swastikas mar vacant house in Monroe.
(1) Coincidentally, property records indicate the house belongs to German financial giant, Deutsche Bank National Trust, which foreclosed on the four-bedroom colonial July 10, according to the story.
In addition to the losses allegedly taken by the lenders, Levinson is accused of stiffing his subcontractors out of about $1.5 million, and pocketing $500,000+ in homebuyer deposits, according to the story.
For more, see St. Louis home builder indicted for bank fraud.
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For more, see NY landlord fined $10K for taking tenant's toilet (if link expires, try here).
For the story, see Single Mother and Children Losing Rental Home to Foreclosure.
(1) According to a 2007 Boston Herald story, Section 8 tenants renting homes in foreclosure have rights under federal law that prevent them from getting kicked out of a home because of any change in ownership, including a foreclosure:
It may be that a lack of affordable legal counsel knowledgeable in Section 8 tenant issues may result in this family being illegally bounced out of their home. For the specific federal regulation on this point, see 24 CFR 982.310(d)(1). Go here for the regulations (24 CFR 982) regulating the Section 8 rent subsidy program, generally. SkimmingKappaRent
For more, see: On Hold: Even Congresswoman Gets the Runaround on Bank Help Lines (Rep. Maxine Waters Dials and Redials Attempting to Get Help for Constituents).
For more, see ‘Model’ foreclosure program seeks ideas for improvement.
Source: Bro: Sis Stole Mom's Home.
Go here, Go here, go here, go here, and go here for other posts related to deed or refinancing scams by forgery, swindle, etc.
Go here, here, here, here, here, and here for other posts on elder financial abuse. KappaDeedTheft FinancialAbuseOfElderlyAlpha
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For the press release, see New Firm Investigates Illegal Mod Companies.
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For the U.S. Attorney press release, see Miami Residents Indicted In Marijuana Grow House, Mortgage, And Money Laundering Scheme.
Go here and go here for other posts on Marijuana Grow Houses.
(1) The indicted defendants are: Manuel Pupo, a/k/a Tata, Elieser Pupo, Serguey Pupo, Elmer Pupo, a/k/a Elmes, Maritza Perez, Noel Albanes-Gomez, Omar Cardenas, Zenaida Rodriguez and Magalys Fajardo, a/k/a Magalys Rodriguez.
(2) Reportedly, as part of the mortgage lending process, the defendants, via Magalys Fajardo, a/k/a Magalys Rodriguez, allegedly submitted fraudulent Uniform Residential Loan Applications, Requests for Verification of Employment, Requests for Verification of Deposit, IRS Forms W-2, payroll stubs, bank statements, as required by the mortgage lenders, through the mortgage broker to the lender for review and credit worthiness approval. pot grow ops beta
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For more, see Miami woman sentenced in multimillion-dollar mortgage fraud.
Go here for the U.S. Attorney press release: De Facto Owner Of Mortgage Companies And title Agencies Sentenced In Multi-Million Dollar Mortgage Fraud Scheme.
For earlier post and more details on this case, see Florida Feds Obtain Indictment In Alleged Mortgage Scam Involving 79 Homes, $24M In Fraudulently Obtained Loans, $5M In Lender Losses.
(1) Reportedly, Cruz, who owned several mortgage and title companies, along with other co-conspirators, would recruit and pay straw buyers for the properties. They then would prepare fraudulent loan applications on behalf of the straw buyers, using false financial documentation. Once the mortgage applications were approved, the lenders would wire the loan proceeds to her companies for closing.
Source: Mortgage Meltdown Results in ‘Tranche Warfare’
For The Wall Street Journal story, see Hancock at Center of 'Tranche Warfare' (subscription required; those without a subscription, go here for a copy & pasted version of the entire story).
For more on the trouble facing the Hancock Tower, see:
For more, see New Battle Affects Home Values: No-Rental Rules.
For more on a story of a homeowner desperate to rent out her home, who received a $5,000 check from a prospective tenant from overseas, with instructions to deposit the check, keep $1,900 for the lease, and wire back the balance, see Police See Increase In Home Rental Scams (Home Owners Become Desperate To Rent Property).
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For the column, see Federal law protects those who inherit homes.
(1) For the Federal law, see 12 USC 1701j–3(d)(5) - Preemption of due-on-sale prohibitions (Exemption of specified transfers or dispositions).
For more, see Fannie Mae's added fee to crunch condo buyers.
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Source: Bar Association Has Pro Bono Assistance For Homeowners.
(1) Homeowners with an upcoming court-mandated foreclosure settlement conference may be assigned an attorney who will voluntarily represent you at the settlement conference. Or, a homeowner's case may be taken by a legal service program to represent them in the entire foreclosure litigation process. Staff from the Legal Aid Society and Legal Services to the Elderly will be there to help.
For more, see Calif woman sentenced in real estate scheme.
See also U.S. Attorney (Los Angeles) press release: Woman Who Promised To Help Homeowners Avoid Foreclosure Sentenced To Over 12 years In Prison For Taking millions From Investors In Fraudulent Scheme.
(1) According to the U.S. Attorney's Office, Standefor’s fraud was what is commonly called “affinity fraud,” that is, a fraud directed at a particular community. Standefor and AFG targeted investors in the African-American community through a now-defunct Web site, word of mouth, real estate seminars and testimonials by other seemingly successful African-American investors. She reportedly cheated investors out of $18 million.
For the Illinois AG press release, see Madigan: Three Charged With Fraud And Forgery In Real Estate Scam.
(1) According to the Illinois AG press release, Nickel and Garner face additional pending charges in a separate Cook County case based on a similar scheme in which they allegedly forged documents in fraudulent real estate transactions in an effort to put an elderly victim out of her home. Nickel is serving 30 months felony probation in Cook County for his previous conviction on five counts of forgery for stealing more than $93,000 from an estate. And in 2004, the Attorney Registration and Disciplinary Commission disbarred Nickel from the practice of law. He is also serving 30 months felony probation for a second conviction on six counts of false impersonation of a lawyer.
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For more, including what else the proposed bill does, see City Tackles Those Who Prey on Homeowners (New Legislation Will Require Licensing of Property Consultants).
(1) For those loan modification firms who purport to review homeowners' loan documents in search of violations of consumer lending laws, as well as violations of other laws relating to bringing foreclosure actions, there already are licensing requirements. Such work requires a law license. Providing these so-called forensic audits of loan documents directly to the consumer without either being an attorney, or without being under the direct supervision and control of an attorney, arguably constitutes the unlicensed / unauthorized practice of law.
Go here and go here for other posts on issues relating to attorneys, loan modifications, and the unlicensed/unauthorized practice of law. See also, Unlicensed Practice Of Law Becomes An Issue With Some Loan Modification Firms.
One of the serious challenges for Iowa’s courts, as outlined by Justice Ternus, is:
For more, see Chief Justice: Iowa courts stretched 'painfully thin.'
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For the rest of this investigative report, see HOUSING: Handful of brokers linked to glut of local foreclosures (21 real estate offices had huge rates of failure among buyers).
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For more, see Rent-to-own homebuying on the rise, and so are problems.
Go here and go here for stories on how easy some tenants found it in getting screwed over in lease/option, "rent to own" and "contract for deed" real estate deals.
(1) Acording to the story, Williams said the surplus of foreclosed homes in bad condition is attracting people looking for a cheap deal on a house. For many buyers, the only option may seem to be a rent-to-own arrangement or contract for deed with a cash-strapped seller. There are no hard numbers tracking this trend but there are widespread reports that these deals are on the rise. rent to own lease purchase option scams yellowstone
For more, see Cabin Lake boarded up, residents out.
For story updates see:
(7-2-09) Danville apartment complex fire ruled arson:
(7-2-09) Cabin Lake fire ruled arson:
(3-16-09) Cabin Lake apartment complex to be sold to highest bidder today:
(3-17-09) Cabin Lake units under new ownership:
(1) Reportedly, one resident who has owned his apartment for thirty years expressed concerns over (a) how unit owners will cope with having to make mortgage payments on those apartments while having to live elsewhere, (b) pipes that will burst during the cold weather, and (c) how there is no lighting at all at the complex, which will make the complex even more of a target for looters as the vandalism has already begun.
Source: IN chief justice: Indiana sees more foreclosures than divorce lawsuits.
She now faces a February 8 eviction date.
For the story, see Redding woman's efforts to save her home end in foreclosure.
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For the press release, see Hagens Berman Files Class Action Against Lending Giant Countrywide.
For the lawsuit, see Clark v. Countrywide Home Loans, Inc., et al.
Thanks to Mike Dillon at GetDShirtz.com for the heads-up on the story.
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For more, see Father Barney takes fees, leaves a "host" of developers behind.
For more, see Embattled developer charged with larceny (George Woodhouse is accused of taking items subject to a lien from two unoccupied houses).
Go here for other posts on pre-foreclosure homeowner fixture stripping.
(1) A special grand jury in July charged him with forging five certificates of occupancy, actions that resulted in 10 felonies. The documents allowed Woodhouse to close on the sales of houses and receive money from his lender, EVB Mortgage, before the county would have issued real certificates. See Forgery trial for Gloucester developer scheduled for Feb. foreclosure fixture stripping apple
For more, see Mortgage-fraud cases are flooding into Tarrant County district attorney’s office.