Posted by 101livescan on 10/4/08 9:44am
Msg #266323

FBI Investigating Mortgage Fraud with a Vengeance Nationally

I was invited to our local Realty Association Monthly Meeting this past week. The FBI's Mortgage Fraud Special Investigator lead was the featured speaker at this meeting. Two and a half years ago when the sub prime mortgage market was at its peak, the FBI set up headquarters here to investigate a 400% increase in mortgage fraud complaints from the public. Mortgage brokers have been prosecuted and links to organized crime have been identified, perpetrators are going and have been for some time to federal prison, not in sunny CA where their families can come for weekly visits but in cold, remote places like Michigan, Ill, Ohio, Iowa. They've been given long sentences and they won't be back here for quite some time.

Just thought you'd like to know something is being done to thwart the efforts of these crooks, in every part of our country where mortgage fraud thrived in the flood of sub prime loan origination.

One signing I had in 2006 for a well educated gentleman, however not loan savvy, in Westlake Village, CA, was a loan originated by a New York mortgage broker who was lending more than the property was worth, and extracting fees in excess of $53K for origination, discount, application, loan tie in, escrow, title, you see they were all one company. The appraisal was exactly twice as much as it should have cost. On the day I was to meet with the borrower, I was receiving calls from four people in NY from the same company, asking me to "sell the loan" to their client and make sure he signed that day so his rate lock would not expire. Talk about high pressure, and when I told the Mortgage Broker it was not my job to sell the loan, he said I would never work as a notary ever again in this state, he would see to it! I wonder where he is today?

Reply by Virginia/PA on 10/4/08 7:32pm
Msg #266364

Sounds like you were doing the RESPA docs if you were to "sell" the loan. If you were doing the actual loan signing, the loan would already have been sold and there wouldn't be any need to "sell" it.

Reply by Virginia/PA on 10/4/08 7:32pm
Msg #266365

Sounds like you were doing the RESPA docs if you were to "sell" the loan. If you were doing the actual loan signing, the loan would already have been sold and there wouldn't be any need to "sell" it.

Reply by 101livescan on 10/5/08 9:15am
Msg #266387

Not at all what I meant. The Mortgage Broker and his agent were trying to get me to convince the borrower that this was a great opportunity for him, cash out, and a low interest rate. It wasn't a great deal at all. They were inflating all the costs of the loan. First Franklin was getting high fees, and the mortgage broker was getting high fees, then there were the points and the discount points to reduce the interest rate. The borrower took one long look at his closing settlement statement and immediately began negotiating the costs. He had never been provided copies of GFE, TILs etc. prior to my arrival with the document package. This is a big reason why FBI is investigating MBs.

Reply by MW/VA on 10/5/08 7:34pm
Msg #266434

I encountered a couple of situations where the "broker" thought I neeed to help him get the loan signed (selling me as well as the borrower). I told them that I was bound by law to be an "impartial third party". One actually accused me of "notary misconduct" and told the ss a pile of lies to cover his a-- when the loan didn't close. It was his position that the loan not closing was my fault. The loan was really horrible--and he was pushing to close it on New Year's Eve & he expected me to sit there for as long as it took for him to convince the borrower to sign. The HUD read like a comic book. I could hear the GREED through the phone!!!!!