California Real Estate Fraud Report

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24
Aug

Homeowners Warned about New Mortgage Fraud Schemes

The U.S. GAO (General Accounting Office) has just released a report on the newest forms of mortgage fraud. Requested by Rep. Doris Matsui of Sacramento,  the new frauds are a variation of the foreclosure fraud schemes in which fraudsters demanded upfront fees and performed little or no work on behalf of the consumer. Attorney General Edmund G. Brown has been aggressively prosecuting licensed agents, attorneys and others who broke the law, with the result that some have been sentenced to prison and fined and some have lost their real estate licenses or the right to practice the law.

The GAO has identified the two new scams as:

(1) a “forensic” loan audit, in which the borrower pays an upfront fee to the “auditor” (someone who is usually NOT an auditor) to see if their were regulatory violations in the original mortgage. The auditor tells the borrower s/he can get the loan modified or even canceled.

(2) the “consultant” promises to get the borrower’s mortgage erased based on a far-fetched notion that the government will pick up the loan due to the lender having done something illegal during the loan origination process.

Read the full article in the Sacramento Business Journal.

© 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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