MORTGAGE FRAUD FACT SHEET For Victims

NATIONAL CRIME PREVENTION COUNCIL Introduction various resources available to assist victims. Mortgage fraud is a crime that hurts homeowners, families, communities, businesses, and the What Is Mortgage Fraud? economy. According to the FBI’s 2010 Mortgage Fraud Report Year The FBI describes mortgage fraud in Review (August 2011), mortgage as the employment of “some fraud schemes continue to escalate. type of material misstatement, Although new laws and protections misrepresentation, or omission have been enacted to address these relating to a transaction, scams, mortgage fraud schemes which is relied on by one or more have been particularly resilient and parties to the transaction.” Mortgage have adapted to economic changes fraud schemes are varied, but and modifications in lending include practices. While total losses directly attributable to mortgage fraud are 77 rescue schemes unknown, there is no doubt actual 77 Loan modification schemes damages are significant. CoreLogic 77 Illegal estimates reported by the FBI 77 Builder bailout/condo conversion indicate annual losses more than 77 Equity skimming $10 billion. In 2011 alone the FBI 77 Silent second received 93,508 suspicious activity 77 Home equity conversion reports relating to mortgage fraud, mortgage totaling more than $3 billion in 77 Commercial real estate loans losses (www.fbi.gov). 77 Air loans An individual who knows or is a victim of mortgage fraud should The perpetrators of mortgage understand what mortgage fraud fraud schemes include licensed/ entails, strategies victims should registered and non-licensed/ employ to protect themselves registered mortgage brokers, from further harm, and the lenders, appraisers, underwriters,

a Mortgage Fraud Fact Sheet for victims accountants, real estate agents, 77 The company/person pressured Step 2 – Speak with a HUD- settlement attorneys, land you to sign over the to your approved housing counselor. developers, investors, builders, home or papers that you did bank account representatives, and not have a chance to read and Obtain counseling services and trust account representatives. They that you expressly did not fully advice from a counseling agency recruit people who can facilitate the understand that has been certified by the U.S. fraudulent activity. Department of Housing and Urban Mortgage fraud schemes have Development (HUD). These adapted to economic changes and Protection Strategies services are free or provided at a modifications in lending practices. nominal cost. You also can obtain Despite efforts to avoid scams, many You may find yourself a victim of assistance from federally funded homeowners fall victim to mortgage mortgage fraud if groups, such as NeighborWorks fraud. The sad reality is that there America, for homeownership is generally little recourse to recover 77 The company/person made education and counseling. Confirm money already paid. However, if promises that are too good to on an official government site you suspect that you have fallen be true (e.g., you are promised that the agency with which you victim to mortgage fraud, you can a loan modification or no are working is approved by the take action to protect yourself from foreclosure) U.S. government, or contact the further problems. 77 The company/person requires Consumer Financial Protection payment of fees in advance to Bureau to be connected to a HUD- approved housing counselor. receive services Step 1 – Contact your mortgage 77 The company offered a money- servicer/lender immediately. back guarantee or advised you Step 3 – Report the Only your mortgage servicer as a homeowner to stop making mortgage fraud to the your mortgage payments, not to has discretion to grant a loan appropriate authorities. contact your mortgage servicer, modification. No third party can or to start making payments to guarantee or approve changes Victims of mortgage fraud should someone other than your servicer to your loan. You are ultimately complain to federal authorities like or lender responsible for the the Federal Trade Commission or 77 The home buying process seemed and must work with the servicer/ the Consumer Financial Protection slower than normal lender to manage the impact of any Bureau, the state attorney general, 77 You experienced bad customer fraud. It is very important that you and the local Better Business Bureau. service to contact the mortgage servicer/ Such complaints assist authorities 77 You felt a lack of information lender and speak with someone in in conducting investigations and during the process the Loss Mitigation Department. prosecuting perpetrators.

3 Mortgage Fraud Fact Sheet for victims

Tools and Resources for Victims To Obtain General Information or Counseling

To Report Scams and Make Complaints 77 Consumer Financial Protection Bureau Website: www.consumerfinance.gov 77 Consumer Financial Protection Bureau Phone: 855-411-CFPB (2372) Website: www.consumerfinance.gov; Online 77 Financial Fraud Enforcement Task Force Complaint Form Website: www.stopfraud.gov/protect-mortgage.html Phone: 855-411-CFPB (2372) Phone: 202-514-2000 77 Federal Bureau of Investigation Email: [email protected] Phone: 800-CALLFBI (225-5324) 77 Federal Bureau of Investigation Online Tips: FBI Tips and Public Leads Form Website: www.fbi.gov/about-us/investigate/white_ To file a complaint with the FBI, contact the nearest collar/mortgage-fraud/mortgage_fraud FBI field office. Locations are listed at www.fbi.gov/ Phone: 800-CALLFBI (225-5324) contactus.htm or https://tips.fbi.gov/, or for major 77 Federal Trade Commission cases you can also report information by calling the Website: www.ftc.gov/bcp/edu/microsites/ toll-free number 800-CALLFBI (225-5324). moneymatters/your-home.shtml 77 Housing and Urban Development Office of the 77 HOPE NOW Alliance Counseling Organizations Inspector General Hotline Website: www.hopenow.com Phone: 800-347-3735 Phone: 888-995-HOPE (4673) Fax: 202-708-4829 77 Making Home Affordable from the Departments Email: [email protected] of Treasury and Housing and Urban Development Address: HUD OIG Hotline (GFI), 451 7th Street, Website: www.MakingHomeAffordable.gov SW, Washington, DC 20410 Phone: 888-995-HOPE (4673) or for hearing impaired 77 Loan Modification Scam Prevention Network 877-304-9709 WebSite: www.PreventLoanScams.org; http:// 77 Loan Modification Scam Prevention Network complaint.preventloanscams.org (complaint form) Website: www.PreventLoanScams.org pHone: 866-459-2162 Phone: 866-459-2162 77 Federal Trade Commission (FTC): Complaint Assistant Other Resources WebSite: www.ftccomplaintassistant.gov WebSite (Spanish): www.ftccomplaintassistant.gov/ 77 Home Loan Learning Center by the Mortgage Consumer_HomeES.htm Bankers Association Phone (for complaints against companies, organizations, or Website: www.homeloanlearningcenter.com business practices): 877-FTC-HELP (382-4357) Phone: 800-793-6222 Phone (for complaints about identity theft): 77 Home Ownership Preservation Foundation 877-ID-THEFT (438-4338) Website: www.995Hope.org Email (for complaints about spam or phishing): Phone: 888-995-HOPE (4673) [email protected] 77 Loan Modification Scam Alert Website: www.loanscamalert.org Phone: 888-995-HOPE (4673) 77 NeighborWorks America Website: www.nw.org Phone: 202-220-2300 a 4 NATIONAL CRIME 2001 Jefferson Davis Highway n Suite 901 n Arlington, VA 22202 PREVENTION 202-466-6272 n www.ncpc.org COUNCIL