Mike’s Real Estate Show

Shark Alert! Beware of this type of seductive deal.

I’ve heard rumors of offers being submitted over $200,000 over asking price! I think we all know what’s happening in these situations. Be advised new legislation is underway at the Federal level for an additional $32 Million in funding for the FBI to combat one thing: Lender Fraud! Please read on!
And don’t think I’m dumping on the lending community; as they say, it takes two to tango! The real estate community, in almost every instance, is partnering with this fraud. Don’t let a client talk you into this type of action! Credits are allowable- 3 to 6% of the sales price—and MUST appear on the HUD 1 Statement!!  Check with your lender and avoid the dreaded “$000,000 to be credited to an undisclosed third party prior to the close of escrow. Said party to be disclosed at that time”. We’ve been seeing this for many months. You can combat this by insisting, in an addendum, for “Lender” approval—not the lender “brokering” the loan but the actual “investor” who will be “funding” the loan. It’s your license!
OKLAHOMA CITY, OK - A Federal Grand Jury handed down a 14 count indictment charging that at least seven people were engaged in schemes to defraud various mortgage lenders by artificially inflating the sales prices of homes and submitting false loan applications.
The seven people referenced in the indictment are:
• Brandon L. Baum, a real estate agent for Charles Burt Realtors and controller of Secorum Investments
• Charles E. Caldwell, Jr a mortgage broker with United Lending of Oklahoma City
• Gayle L. Caldwell owner of Access Marketing Services, Inc and wife of Charles Caldwell
• Joseph Conrad Therrien a borrower/purchaser
• Teresa M. Therrien a borrower/purchaser
• Rusty Real Therrien a borrower/purchaser
• Timothy J. McDaniel a borrower/purchaser
The scheme involved potential home buyers, represented by Baum, being told that if they agreed to purchase homes at inflated prices they would receive funds at closing under the guise of “repair costs” which would be for their personal benefit. Sellers of certain hard to sell properties negotiated the sales through Baum. Baum would always offer more than the listed sales price.
Charles E. Caldwell, Jr and others at United Lending facilitated the submission of fraudulent loan applications to lenders for buyers who could not qualify to purchase homes at the artificially inflated prices. False details of income and assets were supplied on the mortgage applications. In some cases buyers, represented by Baum, would be provided with “down payment loans” which were to be repaid from the funds they received at closing.
Below is the link to “National Realty News.com” who’s article I’m referenced.
http://nationalrealtynews.com/content/templates/standard.aspx?articleid=306&zoneid=1