Housing Scam Crackdown

Several federal agencies are teaming up to fight mortgage and foreclosure scams. Treasury, the Department of Justice, the Federal Trade Commission and the Department of Housing and Urban Development will lead the effort.

The Federal Trade Commission recently reviewed online and print advertising for mortgage foreclosure companies nationwide and found 71 distinct companies running suspicious ads.

The FTC has filed five civil cases against companies offering loan modification or foreclosure services, including one against a company that spent $9 million on TV and radio ads in less than a year.

The initiative will bring more resources for the FBI and the Justice Department to investigate and prosecute mortgage fraud.

Mortgage fraud has reached an all-time high even as the number of home loans being issued has shrunk, according to a report issued last month by the Mortgage Asset Research Institute and the Mortgage Bankers Association.

The FBI is investigating more than 2,100 mortgage fraud cases, up almost 400% from five years ago.

Fraudsters typically charge troubled borrowers an up-front fee to help them get relief from burdensome housing payments but fail to deliver any aid.

Have you, or someone you know, fallen victim to some sort of mortgage fraud or housing scam? We’d love to hear about it. Use the commment link below to sound off. Your email address will not be published here to protect your privacy.

 
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