How is foreclosure fraud committed?

Foreclosure fraud is a white-collar crime that is committed through practices that affect the foreclosure process in Kansas. Foreclosure fraud can be perpetrated by homeowners, lenders, and third-party investors who seek to gain an unfair financial advantage. Some of the most common forms of foreclosure fraud include identity theft, loan modification scams, and deed flipping. Identity theft is a form of foreclosure fraud where the individual uses someone else’s personal information, such as a Social Security number, to obtain a loan or a home. The scammer then immediately abandons the property and leaves the homeowner with a large debt. Loan modification scams occur when a fraudster offers to help a homeowner modify their loan to make it more affordable in exchange for an upfront fee. The scammer will often pocket the fee and never modify the loan, which leads to the homeowner eventually defaulting on payments and being foreclosed on. Deed flipping is similar to loan modification scams in that the scammer targets financially vulnerable homeowners. The scammer will offer to purchase the homeowner’s home at an above market rate in exchange for an upfront fee. The scammer will then resell the property to a third-party at a much higher rate, pocketing the difference. All of these practices lead to a homeowner being unable to pay their mortgage and eventually losing their home through foreclosure.

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How is foreclosure fraud committed?

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