Mortgage Fraud: Current Trends and Issues

  • December 17, 2012
  • • Written by: Nicole Forbes Stowell, J.D. Katherine Barker-Cagwin, Ph.D. James Fellows, Ph.D. 

Winter 2012, Vol. 37, Nos. 2&3
Abstract; The Great Recession of the past few years and its parallel “meltdown” of the real estate market have had a sinister “underbelly” to it. The perpetration of fraudulent real estate transactions was, and still is, widespread, especially in the mortgage industry. This article surveys the more common types of mortgage fraud, to include such criminal methods as short sale schemes, foreclosure rescue schemes, builder bailout schemes, straw buyer schemes, and mortgage loan origination schemes. The article also describes some of the actual cases that depict these fraudulent transactions, and reviews some of the techniques that real estate professionals can use to protect their clients, and themselves, from becoming victims of these frauds.