As if Foreclosures are not bad enough-Foreclosure rescue scams still a problem:
During 2009, the Federal Bureau of Investigation (FBI) delved into more than 2,100 mortgage fraud cases, up 400 percent from five years ago.
The FBI estimates that 80 percent of all mortgage fraud involves collaboration or collusion by industry insiders. The FBI reports that equity stripping and property flipping are common schemes. Short Sales will likely be the next big arena for fraud scams.
Foreclosure rescue scams take several forms but usually involve payment of an upfront fee in exchange for a promise to resolve a pending foreclosure, the OTS report explained. Ultimately, the scam results in unsuspecting victims losing their homes to foreclosure.
With the rapid growth of real estate markets and the development of new technology associated with refinancing and computer-driven underwriting methods, the opportunity for mortgage fraud continues to escalate.
