Real Estate Fraud

Print
Press Enter to show all options, press Tab go to next option

The Real Estate Fraud Unit focuses on investigating and prosecuting real estate fraud crimes in Fresno County. This Unit works with various state and local agencies as well as real estate professionals in an effort to educate and prevent such fraud.

The types of cases investigated by this unit involve fraudulent real estate transactions, some of which are described below.

Report Real Estate Fraud by filling out the Real Estate Fraud Referral Form and mailing to the address at the bottom of the page.

Real Estate Schemes

Loan Modifications/Foreclosure Consultant Equity Purchaser scam 

A person representing himself or herself to be an expert on foreclosure lures a homeowner to pay fees and costs to save their home. These homeowners may be behind in their payments, have received a notice of default or a notice of trustee sale. The person often tells the homeowner to stop paying their mortgage payments to the bank and start paying the person’s company. S/he will also ask that all letters or notices from the lender/bank be forwarded to the company and tell the homeowner not to talk to the lender/bank.

Sometimes the person will also offer to “buy” the home for a short time to allow the homeowner to improve their credit score, thus qualifying for a new (better) loan. This “sale” is nothing more than the homeowner transferring the property into the person’s name; the homeowner receives no money. The person then collects another fee to assist the homeowner in fixing their credit. Upon qualifying for a new loan, the person would “sell” the house back to the homeowner. In reality, the homeowners are unable to fix their credit and/or unable qualify for a new loan and the house is sold at a foreclosure sale.

Refinance scam

A mortgage broker promises low monthly payments by consolidating the homeowners debt such as existing mortgages, credit card debt and car loans. The homeowner is pressured into signing a stack of documents and not given time to read them. The result is a loan that charges very high fees, pay-off phantom creditors and contains terms that are different from what was promised. The person knows what the homeowner can pay and sets the payments just high enough for the homeowner to default on the loan. The lender then starts the foreclosure process or refinances the loan again charging additional high fees.

Fictitious Grantor

A person forges the signature of a homeowner on a grant or quitclaim deed transferring the property into his/her name. The person then sells the property and/or takes out a loan while the homeowner is still living in the home. The homeowner doesn’t find out about the fraudulent transfer until contacted by the bank or the new owner.

Fictitious Buyer

The loan applicant (buyer) may or may not exist or a real person's name and personal information may be used without their knowledge. The person receives proceeds from the sale, either by a fraudulent credit claim or by renting out the house to unsuspecting renters or both. The person fails to make the mortgage payments and eventually the home is foreclosed.

Foreclosure results against a person who was never involved in the transaction. If a real person’s name is used, the negative foreclosure information goes onto their credit report and they may not find out about it until months or even years later.

Loan Fraud

  1. False application by real buyer
  2. False information by strawbuyer - an individual is solicited and paid for services.

Strawbuyer: A mortgage broker pays an individual with good credit to “rent” their personal information. Often, the strawbuyer’s income is inflated to qualify for a more expensive home. The borrower has no intention of occupying the property and makes no down payments. The person gets a higher fee and may install renters. In the meantime, mortgage payments aren’t made and the house goes into foreclosure. The renters are unaware of the fraud until notified by the lender.

Rental Fraud

A person will advertise for renters to a property s/he does not own, often on Craig’s List. The person will usually only correspond with applicants via e-mail. The applicant is told to deposit the rent and security deposit into a bank account. Once the applicant goes to the property, they find out that there are already people living there (the homeowner) or other renters (who also paid the person to rent the property).

Real Estate Links

Report real estate fraud to the DA Office.

Free viewers are required for some of the attached documents.
They can be downloaded by clicking on the icons below.

Acrobat Reader Flash Player Windows Media Player Microsoft Silverlight Word Viewer Excel Viewer PowerPoint Viewer