Refinancing a home should be a straightforward process. You get a new loan, pay off the old loan with the proceeds, and maybe pocket a few dollars in the process.
That is what nursing aide Imogene Hall had in mind when she needed to tap her home equity for $50,000 to help pay bills in between jobs. The home, which she had bought for $80,000, was now worth quite a bit more, so she decided to use the asset to help her get through some tough times in the bottom of the Great Recession.
Things turned south when “mortgage broker” Johnson Cuffy came knocking. Cuffy created a very complex transaction, received a mortgage for the full home value from a subprime lender, gave Hall the $50,000 she was looking for, and pocketed the difference. Cuffy turned out to be hiding his plans for mortgage fraud, and Hull wound up on the wrong side of the deal.
Hall began making mortgage payments to Cuffy, but rather than pass them onto the subprime lender as agreed, he kept those payments and sent fraudulent receipts for the payments.
In the end, Cuffy and his partner got away with over $180,000, and Hall is set to lose her home. After an expensive and utterly terrible legal defense, the foreclosure judge ignored all evidence of fraud and ordered an eviction notice.
Hall was evicted along with her three children and three grandchildren from their 1,500 square foot home with an assessed value of $98,310, far less than the $230,000 fraudulent mortgage created in her name.
Whenever you are involved in a real estate transaction, always work with well reputed brokers and lenders to help avoid mortgage fraud.
Read the entire story at AOL Real Estate.