Which comes first, Foreclosure Fraud or Real Estate Fraud Darcy Mercieca? Believe it or not, foreclosure fraud comes first! Most people think that purchasing real estate comes first, because foreclosure happens after you purchase your home or commercial property. From the closing, the bankers gamble on every home or property going into foreclosure. The banks buy extra insurance besides the one you pay for in your monthly payments under homeowner’s insurance in order to start the future foreclosure action.
1. What is Real Estate Fraud?
2. Does Real Estate Fraud contain Appraisal Fraud?
3. When does Foreclosure Fraud begin?
4. What can I do about the foreclosure fraud?
The foreclosure fraud begins when an offer is accepted by the seller and the buyer begins to complete the purchase paperwork to get financing. In the very first part of the transaction, you are given a virtual stack of papers placed in front of you and instructed where you are to start signing or initialing on those “closing documents”. There are so many different documents with enough legal language that you could have read for hours just to get through them the first time, much less begin to fully understand them. You are not given a copy of all these documents at least 3 to7 days prior to the closing, so you can read and study these documents to fully understand what it actually is that you are signing and agreeing to? That has never happened for the average consumer and purchaser of a property in my many years of being a Realtor. WHY? You have a stack of documents placed before you at the “closing” that you haven’t ever seen before and are instructed where to sign or initial to complete the transaction and get your new home usually within 30 minutes from a stranger you have never met. You depend on the real estate agent, in most cases, to bring the parties together at the closing after you have supplied enough financial data and other requested information so that the “lender” can determine whether you can qualify for their loan.
You can do a few things about the foreclosure fraud. The first thing is to not buy a home or commercial property unless you pay cash for the property. This is not very feasible, is it, since not many people have the cash to buy a property? The second thing is to contact a mortgage lien release company for help. These professionals will guide you through the three phase process that can get your home or commercial property free and clear of any mortgage lien. Be sure to do your research first.
The legal definition of Real Estate Fraud is any false representation of a matter of fact, whether by words or conduct, or concealment or nondisclosure coupled with intent to deceive made in conjunction with a real estate transaction and is reasonably relied on as truth. Also, any act, expression, omission, or concealment calculated to deceive another to his or her disadvantage the affirmative defense of having acted in response to a fraud. (Source: Online legal dictionary).
Do you remember the Foreclosure Fraud Within Real Estate Fraud in the legal definition? This is actually where the foreclosure fraud and real estate fraud begins, not to mention the appraisal fraud perpetrated by the banks and lenders.
Obviously you have the three day right of rescission, if you knew but was not disclosed, even though it was in the endless stack of documents that you signed, but you don’t stop to read all the documents after you have just purchased your home and want to move in? Something being wrong with what we have just signed is not a primary thought in your mind at that time? Did you trust the people involved in the transaction? Are you naturally focusing on getting moved into your new home and getting settled with your family? This is where the foreclosure fraud and real estate fraud begins without proper disclosure to you given by the closing agent, as usually he or she is the only one in the room at your closing with no witnesses that appear on your mortgage contract.
Yes, Real Estate Fraud does start with the Appraisal Fraud. This fraud starts the moment the bank or lender hires an appraiser to appraise the home or commercial property at the asking or purchase price instead of the true current market value. It is a fact that the realtor and appraiser has the same Multiple Listing Service, MLS, in which to find the true current market value of a property. The realtor will list the property at the highest amount to receive more commission. The Appraiser will appraise the property always at the asking of offering price so the lender or bank can make more money in interest rates. As a now inactive Realtor, after many years of activity, I have never seen any property appraised at the current market value!