Sunday, April 17, 2005

FBI Overwhelmed With Mortgage Fraud

The evidence has been mounting that much of the price increases in homes has been an illusion, if not outright fraud. Houston Chronicle, "The FBI won't disclose specifics about the number of Houston area cases under investigation, but Tribble says: "There aren't enough people to work the fraud. That's how big it is."

If somone paid too much for a property, appreciation will not take up the slack. "Some acts of fraud involve misrepresenting a borrower's credit history or income in order to qualify for a hefty mortgage loan. The weight of that debt means they often end up defaulting."

One of the hallmarks of the S&L collapse was flipping and false appraisals.


At 5:45 PM, Blogger Travis said...

What's worse for housing... A recession or inflation? It seems like we're teetering on the edge at the moment.

At 6:37 PM, Anonymous Anonymous said...

How about stagflation? We had that during the '70s...inflation plus a stagnant growth rate. The worst of both worlds.

At 7:51 PM, Blogger Dan said...


There hasn't been a new post in about a couple of hours now! Please do something! I'm addicted and I need my fix! :)

Seriously, I must be checking this site 10 times a day. I guess I'm prone to the housing mania just like the next guy.


At 8:09 PM, Anonymous Anonymous said...

("I must be checking this site 10 times a day.")

It is indeed quite addicting. It has become our home page.

These guys are our support group. When my wife and I feel like we renting may not be for us, we usually find an interesting article reinforcing the fact that it is only a MATTER OF TIME before things turn around.

We made a nice profit from our previous two homes and are not about to jump back in the market until the frenzy dies out and prices retreat at least by 20% in the maket we want live in.

There is just no better housing blog around. Kudos to you buddy!!!

At 8:17 PM, Anonymous Anonymous said...

Best poster nominations go to

John Law and BKlawyer.

At 8:58 PM, Anonymous Anonymous said...

I agree Ben, your blog is great!

By the way, has anybody noticed how the Nikkei is down over 3%? It will be interesting to see what happens on Wall Street tomorrow.

At 9:44 PM, Blogger John Law said...

I read that Soros trades stocks in Japan and elsewhere because they open earlier and he can get the jump...wonder if that's what's happening.

At 9:53 PM, Blogger Ben Jones said...

Thanks guys,
I went down to the brewery for a few. I am ready for what should be a busy week.

I agree about John and BKLawyer, they are a huge help.

Did you hear the Mexican stocks are off 12% this month?

At 10:10 PM, Blogger John Law said...

I wonder if stocks jitters the housing market and people start to sell? I thought maybe it'd happen the other way, people needed to sell stocks to make the mortgage.

At 10:19 PM, Blogger Ben Jones said...

(people needed to sell stocks to make the mortgage)

Excellent point, on Black Monday gold dropped $10 an ounce as people had to cover their stock losses. We could see stocks being sold to pay mortgages.

It's funny to remember, but gold moving $10 in a day was unusual then and the Nasdaq rarely moved but a few points at a time.

At 10:49 AM, Anonymous Anonymous said...

How about stagflation? We had that during the '70s...inflation plus a stagnant growth rate. The worst of both worlds.

How about stagdeinflation. Stagnant Growth, Oil driven Inflation, High Interest Rates, and Housing Bubble deflation

At 11:29 PM, Anonymous Anonymous said...

The next Ben Laden works in real estate appraisal business. It's less messy and bloody. It will have even farther consequences on the real estate market. It's like a new kind of terrorism, but this time it's just done for bucks and not Allah.


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