Guide to Real Estate Fraud

Metro Dream Homes - Charged with $70 Million Fraud Case

The company promised dreams come true with their catchy “Dream Home Program“, which took in more than a thousand investors. The primary suspects charged had the makings of a Madoff style life, lavish lifestyles, chauffeur driven fleet of cars and to polish their reputations,they make generous donations to charity. The mortgage scam covered a period from 2005 till 2007 that spanned a lot of lavish ad programs in areas the likes of Beverly Hills and other high end hotels. In the end, the true colors shone with the victim investors getting nothing more than a $70 million nightmare. Read the rest of this entry »

Cash back at Closing

Though the action or ploy has been ruled out as illegal for a long time but people simply cannot resist the promise of cash when they do closing deal. The promise of a win-win situation for all concerned is the main bait for such fraudulent activities which is just too good to be true, it often is. The crook can be any of the many players in the home sale game, from the buyer, seller, agent, loan officer and even the lender and the victims can also be either of these individuals. The situation has a seller being called upon by a prospective buyer who gets a loan at a higher rate that what the home is actually worth. Read the rest of this entry »

Of Fake Titles and Title Insurance Firms

Land titles are deemed to be the ultimate proof of ownership of a parcel of land which is generally accepted the world over. From various land management and title insurance firms come a risk of fake ones which have managed to pass through all the screening and verification processes that are put in place to check for such fake titles. Even with the event of digitization, most land management authorities still rely on the paper forms which signifies ownership and any other fact that may have to do with the land in question. Read the rest of this entry »

Fraud on the rise with the hard times

With these hard times upon us all, more and more people are looking for ways to help boost their current financial situations. Often times it’s these people who fall pray to scammers looking to take advantage of the situation. It is important that you ignore or immediately delete any suspicious emails asking for personal information. Any legitimate financial institution what needs that kind of personal information will not just send you an email. Also, be wary of companies offering loans even for those with low credit ratings the modus operandi is to have people pay them a supposed processing fee, and once that fee is paid, then the customer doesn’t hear from the company again. It’s a sad fact that many people are taking advantage of the situation, but you need to always be alert and careful when dealing with your money.

Buy and Rent to Own Options

The package includes firms who offer to purchase your home in return for allowing you to stay while you pay them rentals plus additional fees for future ownership. This is welcome news for homeowners who face foreclosure but these people are advised to be wary and to take a serious look at the contracts they are signing. Scam artists are using such platforms to get people to sell them their homes thinking they are under a rent-to-own basis finding they have lost everything due to the home being sold to a different buyer. Scams are at a record high especially with desperate homeowners trying to stave off losing their homes. The federal government has taken up the call and have employed the whole spectrum of media from the internet, movies, print and others just to get the news out to prevent them from being victimized by such enticing yet fraudulent acts.
People who have fallen prey have lost homes and ended up with nothing even their savings as they have used the bulk of it for their monthly rentals, surprised by eviction notices from the new home owner as they lie stunned from the fast evolving events that are unfolding right before their very eyes.

House Stealing

The FBI has released information regarding this rather uncommon crime wherein you, the homeowner can get your home (not the contents) stolen right under your nose without you even knowing about it. Called House Stealing, it has a crook assuming your identity through theft and transfers/sells your property legally.

As the FBI says, it is not easy to stop such a crime so vigilance is the key. How would you feel if you suddenly get an eviction notice saying that the new owner of your house needs you out of there, without even considering selling your home? This is a serious crime and should be treated with utter vigilance for cases are increasing and you are the best defense. Victims are cautioned to contact the FBI or other concerned law enforcement agencies for more information and help.

“Rescue Companies” 2

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The Illinois Attorney General further warned the public of the “title taking scheme”. Con artists would persuade homeowners(especially the older ones) to sign the title of their home over to them, the home rescue fraud scammers, who will then sign it back to them (the owners) after their credit is repaired or after the home’s value increases. Of course, by the time they realize what is axtually going one, they have already lost everything. The Illinois Attorney General has offered her services to prevent homeowners from having their homes foreclosed. Her office has provided the public with a list of counseling centers where homeowners are given a step by step guide to prevent foreclosure to their home and a website where consumers can access her Mortgage Rescue Fraud Brochure. Finally, she implored consumers to do away with “mortgage rescue” companies but instead use the helpline her office provided to prevent the occurrence of fraudulent mortgage-related transactions.

Multi-Level Marketing in Real Estate

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These days “fraudsters” are becoming more inventive. One type of real estate fraud is done by a supposedly “new” multi-level marketing company. In countries that are “havens” of networking companies,this is especially true and it works like a magnet for retirees, overseas workers, anybody who wants to have their own house and lot, housewives, practically anybody who wants to earn big, and those who have savings and are looking for a business to put their hard earned money into. These companies would attract people with a ready networking group, whose members are each willing to invest a considerable amount of money, telling them that for every recruit , they reach a certain sales level position in the company, and they will also earn from the cash investments of their recruit up to the nth degree PLUS the PLUM, which is their “dream home”. This is where fraud sets in. If the networker has not done his homework, meaning the company was not given a thorough background check as to its company history including its affiliates, reliability, credibility and capability to deliver products (actual houses that are already built and ready for occupancy), then they could be in for a shock and total disappointment not to mention the loss of their investment, because there is no actual house and lot that will be given.These companies usually develop tie ups with developers/building contractors to show prospective investors that they have the capability to build houses. However, the usual scenario is that the networking company uses the people’s investment to finance their other businesses, a method which creates an adverse effect. Eventually, a number of investors have fulfilled all the requirements for them to be entitled to their “dream home” but it (the house) can’t be built and given to those entitled to it yet because there is actually no money that can be used to do so. The recruit’s dream home remained just that - a dream!

Beware of Affinity Fraud

There are a lot of religious communities in the world today. These local communities, that share ties of trust, belief and love, will usually go out of their way to help and cooperate with one another. Unfortunately, this trust is also used by unscrupulous individuals to con and steal from their fellow men. In real estate terms, it’s called affinity fraud, where someone uses their position in a religious community to build faith with investors. The people responsible for such scams are usually people who have a high-standing, or are looked up to and respected in their community. Affinity fraud is very devastating to the individual and to the whole community, oftentimes, because of the large number of investors, resulting in hundreds of millions of dollars scammed. This is especially tragic in light of the fact that most investors are regular workers, who may have lost not only their trust, but also their life-savings.

Be cautious of the Real Estate fraud

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Be cautious of any real estate frauds, since many people are venturing nowadays onto these illegal matters just to earn quick money. Some things to watch out for are those real estate industry professionals who conduct 100 percent of their business on a cell phone on the road. Upstanding real estate industry professionals almost always have an official office and telephone line. Verify these information’s through checking the licenses of the real estate agencies in a state, county or city regulatory agencies. Make sure that you are conducting your business transactions at either the real estate professionals’ office or in a bank. Doing this gives you a further opportunity to verify the agent or the broker’s professional standing, as well as alleviates pressure you may feel if someone is strong- arming you inside your own home. And make sure that the name on any documents you are going to sign matches the name of your own personal identification cards.