Real estate ‘flopping’ creating fraud in the home buying market
Fraudulent short sales have increased drastically over the last two years as investors acquire distressed properties at a steep discount.
Suspicious real-estate transactions have surged in the past two years, analysts say, along with the number of short sales. Short sales are supposed to be "arms-length" transactions without any relationship or collusion among the parties, but the parties often are connected. In some cases, this type of mortgage fraud involves buyers acquiring distressed properties for a portion of their value. The rest involve "flopping," where an investor – with the help of an agent or middleman – persuades the bank to agree to a much steeper discount than it should, and immediately resells the property to another buyer for a significant profit without having made any improvements.
Comments on: "Real estate ‘flopping’ creating fraud in the home buying market"
More like this
- Existing home sales up in November as Realtors revise sales numbers down for last 5 years
- Land Acquisition and Development Finance Part 3
- Realtors: Existing-home sales, prices up for sixth straight month in August
- Existing-home sales, prices continue to rise in February
- Existing home prices up in June, tight supply leads sales down