Thursday, June 9, 2011
Short Sale Fraud Increasing
"Flops" as they are called cost banks at least $375 million in 2011. One study said one in every 52 short sales is now deemed "suspicious."
Much like the get-rich-quick real estate gurus pitched flipping courses during the good years, it's now short sale and foreclosure courses during the bad ones. The same sleazy tactics, the identical corner-cutting strategies, and the usual assorted of half-truths and three-quarter lies are on display in these courses.
I recently reviewed two such home study courses sent to me by a reader of this blog. I would welcome any other information from short sale courses you own that speak to this level of mendacity.
Let me be very clear. Not all investor generated flips are flops, of course. Here is an excellent article that explains the difference. But many proposed short sales are intentional flops. Everyone in the business has experience in this direction.
Once again, when you have real estate gurus openly giving seminars on how to commit short sale fraud, the government and the banks should not be surprised that is precisely what you are going to get.
Anyway, here is some excellent advice on avoiding short sale fraud if you are a homeowner or realtor.
My best advice to you on short sales is simple.
Some homeowners need to do short sales to get out from underwater mortgages. If this is your situation, work only with a real estate agent with short sale experience. FORGET ABOUT DOING BUSINESS WITH PEOPLE YOU MEET THROUGH FLYERS MAILED TO YOUR HOME OR PUT ON YOUR DOOR!
My advice to investors is to avoid them nearly all of them at the present time. Short sales are more bother than they are worth. Many agents do not want to admit their listings are short sales because buyers know the process means more time and paperwork.
With so many motivated sellers these days, why only target those who are underwater? They may be more motivated but are also in a less powerful place to make deals with you.