Fraudclosure Auctions: Bogus Prices Hiding Profit and Creating False Home Values
Is there not one part of the fraudclosure process that does not involve fraud?
Properties purchased through Orange County Clerk of Courts foreclosure sales at one price are appearing in the county Property Appraiser’s Office records at a higher price, often tens of thousands of dollars more, according to an Orlando Sentinel review of 16 recent purchases.
The discrepancy illustrates inherent flaws in a system that apparently allows investors buying up distressed properties to inflate the sale price of their real estate by paying a slightly higher state tax on the sale, commonly known as “documentary stamp tax.” The disparity in prices has gone unnoticed by the three county government bodies with a role in the sale and recording process — until now.
By having higher sale prices on record with the Orange County Property Appraiser’s Office, investors looking to later unload the properties could mask their profits when they sell the real estate to new buyers.
It’s not clear how widespread the bogus sale prices are, but the implications are vast in a county that saw nearly 18,000 foreclosure cases last year alone. The phony sales prices could be skewing appraisals being done in those neighborhoods and influencing bank lending practices as well, said Orange County Property Appraiser Bill Donegan.
“It has some implication in there that borders on the side of fraud,” said Donegan, who was unaware of the sale-price differences until the Sentinel told him about the increases Thursday. “I have phony sales on our website. Of course I’m concerned. Absolutely.
Check out the rest here…
If it is happening in Orange county, it is most likely happening in EVERY county.
Guess we have a new little project to work on…