Short Sale Fraud – The newest problem in real estate is not yet a law or an official policy, but it is definitely going to create issues in the market. The latest opinion released from Freddie Mac on short sales presents legal and practical issues for short sale investors.

The organization posted a new educational article on April 16, 2010 titled “Emerging Fraud Trends: Short Payoff Fraud.” The article described a new trend in short sale fraud that happens when a short sale buyer flips a newly acquired property to another buyer and “pockets the difference.” This could spell trouble for investors who have been short-sale flipping, which means negotiating a short sale with the bank, then selling the property immediately to another buyer for a profit of a few thousand to tens of thousands of dollars.

The article described scenarios and red flags for short sale payoff fraud. The scenario revolved around a short sale facilitator who set up a deal with a lender to purchase a home worth 80K for 70K while the lender took a 30K loss. In the scenario, the facilitator fails to notify the bank he has a higher offer, 95,000, on the house. The second the facilitator puts his profits in his pocket, Freddie Mac considers him guilty of fraud because his negotiations caused Freddie Mac to ultimately take a “larger than necessary” loss on the sale of the property.

The posting encourages buyers, sellers and lenders to look out for short sale fraud red flags. These flags include sudden borrower default, a borrower who is current on other obligations and the buyer of the property being an entity rather than a person. Additionally, they encourage people to look for an option clause in their purchase contracts that allow the buyer to resell the property.

Finally, sellers, buyers and lenders are all encouraged to report this short payoff fraud if they are aware of a second purchase contract for a higher price. Short sales may not be breaking the law, but Freddie Mac’s PR team certainly wants the process to be as difficult as possible for all real estate investors.

Technorati Tags: 70k, abc short sale, Bomb, Borrower Default, Educational Article, Facilitator, Fraud Trends, freddie mac, Lenders, Mac Sales, Negotiations, New Trend, Pockets, Profits, Purchase Contracts, real estate investors, Red Flags, Report Fraud, Scenarios, short sale fraud, Tens Of Thousands, Thousands Of Dollars

Short Sale Fraud – The newest problem in real estate is not yet a law or an official policy, but it is definitely going to create issues in the market. The latest opinion released from Freddie Mac on short sales presents legal and practical issues for short sale investors.

The organization posted a new educational article on April 16, 2010 titled “Emerging Fraud Trends: Short Payoff Fraud.” The article described a new trend in short sale fraud that happens when a short sale buyer flips a newly acquired property to another buyer and “pockets the difference.” This could spell trouble for investors who have been short-sale flipping, which means negotiating a short sale with the bank, then selling the property immediately to another buyer for a profit of a few thousand to tens of thousands of dollars.

The article described scenarios and red flags for short sale payoff fraud. The scenario revolved around a short sale facilitator who set up a deal with a lender to purchase a home worth 80K for 70K while the lender took a 30K loss. In the scenario, the facilitator fails to notify the bank he has a higher offer, 95,000, on the house. The second the facilitator puts his profits in his pocket, Freddie Mac considers him guilty of fraud because his negotiations caused Freddie Mac to ultimately take a “larger than necessary” loss on the sale of the property.

The posting encourages buyers, sellers and lenders to look out for short sale fraud red flags. These flags include sudden borrower default, a borrower who is current on other obligations and the buyer of the property being an entity rather than a person. Additionally, they encourage people to look for an option clause in their purchase contracts that allow the buyer to resell the property.

Finally, sellers, buyers and lenders are all encouraged to report this short payoff fraud if they are aware of a second purchase contract for a higher price. Short sales may not be breaking the law, but Freddie Mac’s PR team certainly wants the process to be as difficult as possible for all real estate investors.

Technorati Tags: 70k, abc short sale, Bomb, Borrower Default, Educational Article, Facilitator, Fraud Trends, freddie mac, Lenders, Mac Sales, Negotiations, New Trend, Pockets, Profits, Purchase Contracts, real estate investors, Red Flags, Report Fraud, Scenarios, short sale fraud, Tens Of Thousands, Thousands Of Dollars

Short Sale Fraud – The newest problem in real estate is not yet a law or an official policy, but it is definitely going to create issues in the market. The latest opinion released from Freddie Mac on short sales presents legal and practical issues for short sale investors.

The organization posted a new educational article on April 16, 2010 titled “Emerging Fraud Trends: Short Payoff Fraud.” The article described a new trend in short sale fraud that happens when a short sale buyer flips a newly acquired property to another buyer and “pockets the difference.” This could spell trouble for investors who have been short-sale flipping, which means negotiating a short sale with the bank, then selling the property immediately to another buyer for a profit of a few thousand to tens of thousands of dollars.

The article described scenarios and red flags for short sale payoff fraud. The scenario revolved around a short sale facilitator who set up a deal with a lender to purchase a home worth 80K for 70K while the lender took a 30K loss. In the scenario, the facilitator fails to notify the bank he has a higher offer, 95,000, on the house. The second the facilitator puts his profits in his pocket, Freddie Mac considers him guilty of fraud because his negotiations caused Freddie Mac to ultimately take a “larger than necessary” loss on the sale of the property.

The posting encourages buyers, sellers and lenders to look out for short sale fraud red flags. These flags include sudden borrower default, a borrower who is current on other obligations and the buyer of the property being an entity rather than a person. Additionally, they encourage people to look for an option clause in their purchase contracts that allow the buyer to resell the property.

Finally, sellers, buyers and lenders are all encouraged to report this short payoff fraud if they are aware of a second purchase contract for a higher price. Short sales may not be breaking the law, but Freddie Mac’s PR team certainly wants the process to be as difficult as possible for all real estate investors.

Technorati Tags: 70k, abc short sale, Bomb, Borrower Default, Educational Article, Facilitator, Fraud Trends, freddie mac, Lenders, Mac Sales, Negotiations, New Trend, Pockets, Profits, Purchase Contracts, real estate investors, Red Flags, Report Fraud, Scenarios, short sale fraud, Tens Of Thousands, Thousands Of Dollars

Short Sale Fraud – The newest problem in real estate is not yet a law or an official policy, but it is definitely going to create issues in the market. The latest opinion released from Freddie Mac on short sales presents legal and practical issues for short sale investors.

The organization posted a new educational article on April 16, 2010 titled “Emerging Fraud Trends: Short Payoff Fraud.” The article described a new trend in short sale fraud that happens when a short sale buyer flips a newly acquired property to another buyer and “pockets the difference.” This could spell trouble for investors who have been short-sale flipping, which means negotiating a short sale with the bank, then selling the property immediately to another buyer for a profit of a few thousand to tens of thousands of dollars.

The article described scenarios and red flags for short sale payoff fraud. The scenario revolved around a short sale facilitator who set up a deal with a lender to purchase a home worth 80K for 70K while the lender took a 30K loss. In the scenario, the facilitator fails to notify the bank he has a higher offer, 95,000, on the house. The second the facilitator puts his profits in his pocket, Freddie Mac considers him guilty of fraud because his negotiations caused Freddie Mac to ultimately take a “larger than necessary” loss on the sale of the property.

The posting encourages buyers, sellers and lenders to look out for short sale fraud red flags. These flags include sudden borrower default, a borrower who is current on other obligations and the buyer of the property being an entity rather than a person. Additionally, they encourage people to look for an option clause in their purchase contracts that allow the buyer to resell the property.

Finally, sellers, buyers and lenders are all encouraged to report this short payoff fraud if they are aware of a second purchase contract for a higher price. Short sales may not be breaking the law, but Freddie Mac’s PR team certainly wants the process to be as difficult as possible for all real estate investors.

Technorati Tags: 70k, abc short sale, Bomb, Borrower Default, Educational Article, Facilitator, Fraud Trends, freddie mac, Lenders, Mac Sales, Negotiations, New Trend, Pockets, Profits, Purchase Contracts, real estate investors, Red Flags, Report Fraud, Scenarios, short sale fraud, Tens Of Thousands, Thousands Of Dollars

Short Sale Fraud – The newest problem in real estate is not yet a law or an official policy, but it is definitely going to create issues in the market. The latest opinion released from Freddie Mac on short sales presents legal and practical issues for short sale investors.

The organization posted a new educational article on April 16, 2010 titled “Emerging Fraud Trends: Short Payoff Fraud.” The article described a new trend in short sale fraud that happens when a short sale buyer flips a newly acquired property to another buyer and “pockets the difference.” This could spell trouble for investors who have been short-sale flipping, which means negotiating a short sale with the bank, then selling the property immediately to another buyer for a profit of a few thousand to tens of thousands of dollars.

The article described scenarios and red flags for short sale payoff fraud. The scenario revolved around a short sale facilitator who set up a deal with a lender to purchase a home worth 80K for 70K while the lender took a 30K loss. In the scenario, the facilitator fails to notify the bank he has a higher offer, 95,000, on the house. The second the facilitator puts his profits in his pocket, Freddie Mac considers him guilty of fraud because his negotiations caused Freddie Mac to ultimately take a “larger than necessary” loss on the sale of the property.

The posting encourages buyers, sellers and lenders to look out for short sale fraud red flags. These flags include sudden borrower default, a borrower who is current on other obligations and the buyer of the property being an entity rather than a person. Additionally, they encourage people to look for an option clause in their purchase contracts that allow the buyer to resell the property.

Finally, sellers, buyers and lenders are all encouraged to report this short payoff fraud if they are aware of a second purchase contract for a higher price. Short sales may not be breaking the law, but Freddie Mac’s PR team certainly wants the process to be as difficult as possible for all real estate investors.

Technorati Tags: 70k, abc short sale, Bomb, Borrower Default, Educational Article, Facilitator, Fraud Trends, freddie mac, Lenders, Mac Sales, Negotiations, New Trend, Pockets, Profits, Purchase Contracts, real estate investors, Red Flags, Report Fraud, Scenarios, short sale fraud, Tens Of Thousands, Thousands Of Dollars