California Real Estate Fraud Report

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03
Dec

HUD-OIG is Watching for Fraudulent Appraisals in Reverse Mortgages

According to a report prepared by the Office of the Inspector General for the Department of Housing and Urban Development, the agency said that it has identified cases of fraudulent property appraisals being used to increase the loan amount for the refinancing of HUD’s Home Equity Conversion Mortgages, HECM.

The purpose for the run-up in appraisals would be to extract higher loan amounts from lenders, which would include loan backers Fannie Mae and Freddie Mac. Some of the appraisals were inflated as much as 60% to 100% over the true market value of the property.

In response, HUD-OIG has issued a warning to appraisers, loan officers, originators and sponsors that the consequences for those who engage in fraudulent HECM transactions will be severe and range from criminal, civil prosecution, or administrative sanctions “as appropriate.”

Read the original article in HousingWire.

 

© Copyright 2007-2017 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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