Tag Archives: real estate scams

Real Estate

Some More Possible Real Estate Scams to Watch Out For

Real estate scams are more and more popular, even though we can’t see them yet. Compared to robbing a bank, stealing 50 0,000-worth property via a false deed or an identity theft is trivial – and remarkably safe for the thieves. Their imagination is remarkable and oftentimes we can’t do much more than minimizing the damage they inflict. By becoming aware of the most common real estate scams, you may be able to protect yourself or someone you know.

False Deeds, Part 1

Most real estate frauds revolve around forged deeds. The most popular scam is using a false deed in order to get a loan secured against a property. The thief then vanishes with all the money, leaving the real owner in danger of foreclosure by the bank – oftentimes the danger is real if the owner doesn’t react on the first warnings received from the bank.

False Deeds, Part 2

Another common real estate fraud is selling a property without the owners consent. The uninhabited, recently inherited and otherwise unguarded property is the most probable target for such scams. The most inventive thieves are able to even sell the same property to several buyers at the same time. However, if they have sold it only to a single buyer, the fraud can go unnoticed for months or even a year. By that time, the “owner” is long gone, usually in another state, selling another home to someone else.

Real Deeds

The false deeds are bad enough, as such scams usually hit at random and they often can be reversed after the deed is thoroughly checked. However, the problem begins when the fraud is performed using a real deed, one that was either stolen or simply taken from the owner. The sad thing is that such thieves often recruit from our family and closest friends, people we would never suspect of anything.

The most popular way is to get some kind of authorization (or truly, just a signature) from the owner in addition to a deed. This way the thief can do whatever they like without any real risk for being caught. This is an especially popular scam used against elderly people – a nurse or a family member either take a loan in the name of the elder or just force them into taking it.

Another, even more outrageous, real estate fraud is performed by unethical door-to-door loan sellers. Under the pretext of making home repairs, they force the seniors into signing some documents which are truly high-rate loan contracts secured against the property. As most seniors are unable to repay such debt, their homes are taken by the creditor (which was its goal from the beginning) and the elder is left homeless.

Defense

Defending against such frauds is difficult. If the thieves use false deeds, it is possible to prove that you had nothing to do with the loan or purchase. However, if they use a real deed and/or have your authorization, this gets dicey. And taking effective legal actions is next to impossible if you sign the loan papers.

Here are some tips to help protect yourself from such scams: 1) never sign anything you haven’t thoroughly read and if you are in doubt have your attorney review the documents before signing; 2) throw out any peddling loan lenders; 3) keep important documents, such as your deed, in a safe deposit box.

For all your real estate needs Call
John J. O’Dell
Real Estate Broker
(530) 263-1091

DRE# 00669941

Real Estate

Another Craiglist Real Estate Scam

A crook with a computer has stolen an online listing from an Ames real estate company and is posting it on Craigslist as a rental, asking people to wire hundreds of dollars overseas, according to local and state sources.

Hunziker & Associates agent Tabitha Zesch said the property — a single family home priced at $129,900 — has been posted as a rental on Craigslist.

The scam artist put a story on the web page, “saying that the owners had been transferred overseas, that the property rents for $700 a month and that if anyone wanted, they could wire a deposit to hold the property,” Zesch said.

Zesch said her company became aware of the fraud only because a potential renter got suspicious, tracked down Hunziker as the listing agency and e-mailed her office.

She said her company notified state and federal authorities and alerted Craigslist, but that the listing was still there late Tuesday afternoon.

Bill Brauch, director of the consumer protection division for the Iowa Attorney General’s office, said scams like this one “are fairly common.”

“If you’re selling a home or some real estate online, (the crooks will) duplicate the ad and set up a scam of their own,” he said.

Source Ames Tribune

Need real estate help?
Call John J. O’Dell
Real Estate Broker
530-263-1091
DRE #00669941

Real Estate

Five Real Estate Mortage Scams to Watch Out For

Don’t be duped by mortgage fraud. Here are a few common scams and the red flags you should look for in a transaction.

Mortgage fraud is pervasive: An estimated $4 billion to $6 billion in annual losses result from mortgage fraud, according to FBI reports. “An entire community can be damaged by mortgage fraud,” says Rachel Dollar, a lawyer from Santa Rosa, Calif., and editor of the Mortgage Fraud Blog. Mortgage fraud can lead to a spike in foreclosures, home values plummeting, and lenders raising their rates and fees to recover losses.

The crimes are often complex, involving several parties and occurring over multiple transactions. To protect youself, educate yourself about mortgage fraud and be on guard for any warning signs in a transaction. You can start by reviewing these five scams, and then test your knowledge by taking our Mortgage Fraud Quiz.

1. The Foreclosure Rescue Scheme

The Scam: “Rescuers” promise cash-strapped home owners that they can save their home from foreclosure. The rescue, which involves paying upfront fees, can take multiple forms, such as the perpetrator obtaining a new loan on behalf of the owner or by having the owner sign over the home’s deed and then rent the home until they can repurchase it. Eventually, the home owner loses the home, either to foreclosure or the fictitious rescue company.

Red Flags: With foreclosure rescue programs, borrowers are often advised to sign over the title of their house to a third party, become renters of their home, not contact their lender, or send mortgage payments to a third party, according to Fannie Mae, which provides fact sheets on mortgage fraud.

2. Loan Documentation Fraud

Continue reading Five Real Estate Mortage Scams to Watch Out For →

Real Estate

Flip This House Rip-Off

Here’s one for the books on how to get ripped off. This guy was even on A&E  Flip This House!  Moral of this story, be careful who you deal with. Sam Liccima was promising a return on investment of 16% and the actual return on investment turned out to be – zero percent.

Part One

httpv://www.youtube.com/watch?v=3aG5G38GzhU

Part Two

httpv://www.youtube.com/watch?v=zM8pXjLyGtE

John J. O’Dell
Real Estate Broker
Looking for property in Nevada County?
Click Here

Real Estate

Real Estate Motivational Speaker Heads to His Own Prison Cell

Jail Cell
New quarters for real estate author and motivational speaker.

Have you ever seen these ads that start out – make millions in real estate – you don’t need money, let me show you how to get started in real estate and earn a ton of money in the first month. Excuse me, if you can make millions in real estate using this “motivational speaker’s” techniques , then why is the guy even bothering to try to teach you his “sure why to get rich in real estate”?

I’ve been to one of these seminars. The guy showed up in a chauffeured limo, got out and he had diamonds on his fingers and so much gold jewelry that I was surprised he could walk. (I’m sure all the jewelry was fake) To make a long story short, every thing he said made no sense, but I noticed the people in the audience seemed to be buying his grubbily glop. I’m sure he made a lot of money selling his course and his books and tapes.

Well, here’s one “motivational speaker” from Texas, who hawked a book and infomercial on how to make money in real estate, who is  among eight people convicted of a multimillion-dollar mortgage fraud scheme. Eric Rulack Farrington Jr., 57, was president of Eric Farrington Seminars and Prestige Capital Corp., which did business as Farrington Mortgage Group.

A federal jury this week convicted Farrington of conspiracy to commit wire fraud, bank fraud, aiding and abetting, 15 counts of wire fraud and aiding and abetting, 10 counts of money laundering and aiding and abetting, five counts of engaging in a monetary transaction with criminally derived property and aiding and abetting.

Prosecutors said the eight defendants ran the scheme from March 2002 to January 2006. They found single-family residences for sale in the Dallas area, including distressed and pre-foreclosure properties, and negotiated a sales price. They created surplus loan proceeds by inflating the sale price, often using inflated appraisals.

“In some cases, they would create a bogus outstanding mortgage lien to be discharged,” prosecutors said. “They recruited individuals with high credit scores to act as borrowers and falsely represented to them that the property would be managed by the defendants and rented by a suitable tenant; that the mortgage, interest, taxes, insurance and property maintenance would be paid from the rental income; and the purchasers/borrowers would have no expenses. The borrowers had no intention to live in the property and did not have sufficient income to repay the loans.”

Conspiracy to commit wire fraud and wire fraud carries a sentence of up to 20 years in prison and a $250,000 fine. Bank fraud is punishable 30 years in prison and a $1 million fine. Money laundering is punishable by 20 years in prison and a $500,000 fine, and engaging in a monetary transaction with criminally derived property is punishable by 10 years in prison and a $250,000 fine.

The defendants also must forfeit $8.5 million. No sentencing dates have been announced.

Source: Court News Service

I guess while the group is in jail, they might read some books on real estate law, and maybe they can even read a book on ethics.  I doubt it, what do you think?

John J. O’Dell
Real Estate Broker
Looking to buy or sell?
Call today 530-263-1091

Real Estate

Real Estate Scams Continue to Roll

I’m still receiving letters at the rate of one to two letters a week from overseas scammers  wanting to give me a portion of millions of dollars or invest in real estate. Bad English in writing the letters, promises of giving you a cut of the millions they are supposedly wanting to feral out of the county are tips enough that all these people want is to take your money. Most of them wind up in my spam folder, but you know, I have to check my spam folder to see that a client’s e-mail hasn’t gone there by mistake, so I always open them up for a laugh.

Sad to say, they make millions every year from people in America.  Here’s a video from the today show that explains a common real estate scams.

httpv://www.youtube.com/watch?v=Q1e4CpSyCik

Real Estate

LA Firefigher, Real Estate Broker Faces Jail Time

man in jail cell

It seems that people are always trying to make money by illegal means. If they would put as much effort into doing something legally as the schemes they come up with, they would in all probability make more money. At least they wouldn’t end up in jail.

A case in point is the scheme by a Los Angeles City fire firefighter and part time real estate broker who was arrested on September 23 of this year. In a press release by the Deputy DA of Los Angeles, Brent Lamont Mathews is charged with six counts of forgery, thee counts of attempt to file a false or forged instrument and two counts of grand theft.

Of course to falsify deeds and documents, you need a notary. It was handy of Mathews to have a girlfriend who is a notary. So along with Mathews, his girlfriend Joi Rochelle Smith faces the same criminal charges.

Prosecutors allege that Mathews put himself on the title of a Hacienda Heights property without the true owner’s knowledge or consent through a series of forgeries and false filings. Mathews allegedly went on to defraud two investors in 2008 whom he solicited as partners to flip the house. The victims collectively lost $146,000, which the defendant purportedly borrowed by issuing trust deeds on the property and thereafter filing false reconveyances of those trust deeds.

Smith allegedly notarized key documents, enabling the illegal transactions.

Mathews sold the property for $699,000 and netted $203,969, prosecutors said. None of the proceeds from that sale were used to satisfy the trust deeds or to benefit the true owner of the property.

Detectives of the Los Angeles County Sheriff’s Department, Commercial Crimes Bureau, investigated the matter.

The recommended bail for Mathews and Smith is $846,000. If convicted as charged, the defendants face a maximum state prison term of 11 years and four months.

So isn’t that neat, you put your name on someone else’s property, get some trusting souls to invest in a house that isn’t yours, sell it and net over $200,000. Let’s see divide $200,000 by eleven years in jail, you make about $18,000 a year, minus of course attorney’s fees, income tax and other associated expenses. Of course you have free room and board during your jail time.

Real Estate

Ex-Cowboy Linebacker Eugene Lockhart Arrested in Mortgage Scam

eugene-lockhart

Former Dallas Cowboys linebacker Eugene “The Hitting Machine” Lockhart was arrested by FBI agents at his Carrollton home Thursday morning after being indicted on mortgage fraud charges, the U.S. Attorney’s office said.

Lockhart, 48, and eight others were indicted by a federal grand jury on various charges, including conspiracy, bank fraud and wire fraud. The alleged scheme involved approximately 54 fraudulent residential property loan closings resulting in the funding of $20.5 million in fraudulent loans.

Lockhart, who played for the Cowboys from 1984-90, and co-conspirator Lendell Beacham, 50, of DeSoto, were scheduled to appear before a federal magistrate at 1 p.m. If convicted, they could face up to 30 years in prison and a $1 million fine.

The indictment alleges that Lockhart and the others ran a scheme in which they located single-family residences for sale in the Dallas area, including distressed and pre-foreclosure properties, and negotiated a sales price with the seller. They allegedly created surplus loan proceeds by inflating the sales price to an arbitrary amount substantially more than the fair market value of the residence.

The statement from the U.S. Attorney’s office added that the group recruited individuals to submit false financial information and act as “straw purchasers” or “straw borrowers,” promising to pay them a bonus or commission for their participation.

Source: The Dallas Morning News

Real Estate

Nigerian 419 Scams – Real Estate Transactions, Lonely Hearts and Work at Home

nigeria ripped off

I don’t know how many 419 scam letters I’ve received, promising me untold wealth if I would just communicate with them and send them all of my bank account numbers. I would than receive 30 percent of $48,000,000. Not bad, but why do they always pick $48,000,000? I’ve guess they’ve taken a marketing course and never say it’s $47,999,999.99, because they’re trying to give you something, not sell you something.

Believe it or not, they’re having a hard time. Their income of $30,000 to $60,000 a month has been cut in half or more due to the worldwide downturn in the economy. Americans are just not putting out the money like they use to.

The scammers make their income from promising brides who some how never appear because someone stole the plane fare money at Western Union and would you please re-wire me some more money? I’m very anxious to meet you and marry you, so please send me more money, resulting in some of our fleeced victims losing over $25,000 US. US, you notice they always say US? They want your American dollars not Nigerian coins.
Continue reading Nigerian 419 Scams – Real Estate Transactions, Lonely Hearts and Work at Home →

Real Estate

Mortgage Companies Profit From Foreclosures

fat-banks-252x300

The White House has asked mortgage executives to come up with the manpower to stop precarious loans from becoming foreclosures, but a New York Times story says finance experts say a lack of bodies isn’t the problem. It’s greed.

Mortgage companies collect fees for appraisals, insurance, legal services and other administrative busywork when homes go into foreclosure, and many make more on delinquent loans than they do on those in good standing. So unless homeowners’ loans are through businesses that values their ability to keep roofs over their heads above the bottom line, they’re out of luck:
Continue reading Mortgage Companies Profit From Foreclosures →