Mortgage Fraud Is Alive And Well
Just in late October, the FBI laid fraud charges against 20 people in the Detroit, MI area. As a result, a total of five separate mortgage fraud organizations were disrupted. We can only be thankful that they were stopped, and aren't still making fraudulent transactions and costing us money.
Why would this cost you money? Well, that could happen in two ways. One of the hidden impacts is on the interest rate you pay. After all, if a mortgage is defaulted on, and it turns out the property isn't worth what it was mortgaged for, then the lender is left holding the bag. That "cost of doing business" has to be passed on to someone. That someone would be the person coming in for a mortgage.
The second problem is one of identity theft in order to make fraudulent transactions. This can cost you in a multitude of ways, and not the least of those is being "on the hook" for the mortgage itself!
Identity theft is becoming big business and not just for those who do the identity stealing. Interestingly enough, I just saw an ad a few days ago for "identity restoration insurance". This insurance is specifically designed to provide money to help a person "rebuild" their identity and ensure that the right information is held by credit bureaus and other agencies. Now, I have to think: if the insurance companies are getting into this, it must mean there is a growing market. That is bad news.
There's only one way to fight the problem of identity theft (which should help with the whole mortgage fraud business): protect your identity (and your vital personal information) in the same way that you protect other valuables. Take action to make sure that nothing that leaves your home in your garbage could be used against you. Your best tool in the fight? A fairly inexpensive personal shredder. If something comes in the door and it has your name and address on it -- even if it's an envelope -- shred it. And ALWAYS shred your credit card receipts once you are ready to discard them.
After all, it's the Christmas shoppping season and we're all going to be out there using our credit cards. Let's make sure they don't get used against us.