You want to discuss the shenanigans going on the last few years? Where were you then? it is easy to point out now. I have been blogging on all this crap for over two years telling people that this was going on.

All I got was grief from REIC members who claimed "it was different this time" , "real estate only goes up", "buy now or be priced out forever" , "they are not making anymore land", etc... All so they could make a commission on some unsuspecting schmuck. Now that sales are down 75% from the peak and prices are down 10-15% from the peak everyone is trying to come clean to save their behinds. Too late, IMO, if you were not talking about this before (and I know some who were, they were feeding me information) then you were just part of the problem. Now all we can do is sit back and watch the pain of these foreclosures.

BTW- Friday was a record day for defaults on one day,  88. IN ONE DAY. WOW!

jfrancais -

What if anything has come from the SAR's?

I believe that others besides, you know who, were involved in the transactions that Craddock and Gary Crabtree have spoken of. But so far the federal, state and local authorities have done nothing. Meanwhile neighborhoods with this activity will surely experience some depreciation in values due to the foreclosures and burned out lawns. I guess if we just ignore the problem it will go away.

Anyway, at this point all we can do is watch, the time for action was 2 years ago.

Here is a sample of some stories today from Florida that dicsuss fraud ( http://thehousingbubbleblog...):

“Venetian Isles has long been known as one of the most attractive waterfront communities in southern Pinellas County. In three cases, though, the homeowners association is having a hard time finding the owners.”

“‘A lot of you have been calling to question what is going on with the home on Overlook Drive with the overgrown lawn, and a few other properties,’ president Jim Pelletier wrote in the current newsletter. ‘Believe me, we are very aware of them and involved with them.’”

“The association is dealing with an increasingly familiar problem in the Tampa Bay area as the housing bubble deflates. Many expensive homes were financed for 100 percent of the purchase price and are now falling into foreclosure and disrepair because the absentee owners can’t - or won’t - make the hefty mortgage payments.”

“In Venetian Isles, concern first arose over a house on Carolina Drive whose ‘owners,’ say their signature was forged without their knowledge on $930,000 in loans. The lawn is nearly dead and the house, now vacant, is in foreclosure proceedings.”

“The association has sued the owner of another house, this one on Overlook Drive, the main entrance to the 533-home subdivision on Tampa Bay. Last week, the grass was knee-high and the house was vacant, as it has been intermittently for months.”

“Public records show that the home was purchased in November for $1,050,000, almost $275, 000 more than for comparable sales during the peak of the real estate boom in 2004-2005. The property was financed for the full amount by Virgil Dennard, who showed a California driver’s license as identification.”

“Dennard does not live in the house, and mail sent there was returned as ‘undeliverable,’ according to the association’s law firm. Nor does Dennard live in another house he bought about the same time on Boca Ciega Bay in the South Pasadena area. He financed that for $1.275-million, $25,000 more than the publicly recorded sales price.”

“The sellers of both houses mortgaged in Dennard’s name say the person they dealt with was not Dennard, but a man named Tommy Watts. ‘He called himself an investor,’ said Robert Learned, one of the sellers. ‘He was kind of vague, he didn’t seem to want to talk about what he did.’”

“It’s such a dilemma when we have these absentee owners who are in violation and we have more than 500 other owners who just don’t understand,’ says Linda Testa, head of the deed restrictions committee. ‘There’s nothing we can do but contact the owner, but when we can’t find the owner, it’s a real problem.’”

The Miami Herald. “The Multiple Listing Service is a real estate agent’s bible. But it has also become a tool for fraud. Real estate agents say they are sometimes asked to raise the list price of a home. In mortgage fraud cases, that allows a broker to pay the seller at the original list price and keep the rest of the money as cash back at closing.”

“The false sales information means other sellers can end up overpricing houses that then get stuck on the market, and other buyers can end up paying more than they should.”

“‘The average person in a neighborhood full of fraud is paying higher taxes because of an artificial base, they’re paying more because somebody cheated,, says Nancy Hogan, a member of the Florida Real Estate Commission. ‘On the other hand, when those houses go into foreclosure, they are also bringing down the neighborhood.’”

“‘It scares me to death,’ says Hogan, also managing broker of Coldwell Banker in Coral Gables. ‘Every time I go and give one of my presentations and there are 100 Realtors there and I say, ‘Has any one seen an offer asking for $100,000 going back to the buyer and 50 percent of them raise their hands…it’s that rampant.’”

“Property appraisers in South Florida say they routinely come under pressure to value houses for more than they are really worth. ‘From talking with appraisers in Southeast Florida, there are entire neighborhoods where all of the data is polluted,’ says Francois Gregoire, chairman of the Florida Real Estate Appraisal Board.”

“‘This is the worst I’ve seen it ever,’ says Doreen Campbell, a Davie appraiser who has been in the industry for more than 25 years.”

“Julio Suñe, an appraiser in Monroe County for more than 25 years, said he started shunning assignments from new mortgage companies after several of his appraisals were rejected and orders went unpaid. Other appraisers said the same.”

“Ron Schwartz, an appraiser in North Miami Beach notes that appraisers don’t care if a loan goes through because they get a flat fee. But they come under pressure from others who simply want a deal to go through or are involved in mortgage fraud.”

“‘We were getting calls from mortgage brokers, buyers, sellers and real estate agents,’ says Schwartz, who no longer does work for mortgage brokers. ‘They are screaming and yelling, ‘You appraised my property for $300,000, and we have a contract for $400,000 and you’re ruining our deal.’”

“Campbell reviewed another appraiser’s work for an appraisal management company. When she pointed out significant flaws, she claims her client stopped sending her work.”

“‘They don’t want the truth,’ Campbell says. ‘They kicked me off their list when I said, ‘It’s a bad appraisal and it should be turned in.’”

“Would-be mortgage brokers in Florida need little more than a weekend course to qualify for a license. And loan officers, who originate loans for mortgage lenders and banks, need no license at all.”

“‘Really, it’s too cheap and too easy to become a mortgage broker,’ says Steven Schneider, board member (of the) Florida Association of Mortgage Brokers. ‘I have recommended to the state to raise the cost from a few hundred bucks to $1,000 or more. If it’s not so easy to become one, chances are they won’t.’”

“A new law that takes effect in October will require brokers to have at least a high school education, and to give more detailed disclosures about adjustable-rate mortgages.”

“Jim Greer, president of Gold Coast real estate schools, is not sure stricter licensing requirements would work. He says current requirements are sufficient, and students who learn the laws still may not follow them.”

“‘What you see is greed getting in the way, and doing what they do to make the money,’ Greer says. ‘I don’t know if it’s a 24-hour course or a 60-hours course is going to make an impact.’”

“Underwriting practices for home loans have come under scrutiny in recent months, in light of widespread foreclosures and reports of mortgage fraud.”

“The job of an underwriter is to vet loan applications. But some consumers and investors are now complaining about home loans that got what amounted to rubber-stamp approvals during the real estate boom.”

“One reason for lax underwriting is that companies sell home loans down a chain of investors, and so have little incentive to make sure they are sound, says Dale Ledbetter of Fort Lauderdale-based Ledbetter & Associates.”

“Ledbetter’s firm has recently filed several lawsuits against Wall Street investment companies, alleging they failed to protect investors by properly scrutinizing loans.”

“Problems with underwriting grew largely out of the real estate boom, when lenders assumed, rightly, that rising property values would cover the cost of bad loans, says Juan Carlos Perdomo, VP of sales for Miami-based Verification Bureau. His company provides fraud prevention and data verification systems to mortgage lenders.”

“‘They didn’t want to look into very deep detail because they were concentrating more on getting the commission and getting the deal done,’ he says. ‘They weren’t looking at the long run.’”

“Lenders also faced manpower and time constraints, Perdomo says. The sheer volume of applications prompted some lenders to turn to automated underwriting systems rather than a set of eyes to comb through documents.”

“An audit by one lender showed that borrowers’ income was exaggerated by more than half in nearly 60 percent of its loans requiring no documentation.”

“‘If Wall Street had said, ‘We are going to be more careful about what we are going to take. We’re going to do more due diligence,’ then mortgage fraud would not have proliferated to the extent that it did,’ says attorney Ledbetter.”

Based upon the timing of your blog and the article in Sunday's Californian, it's obvious you're talking about Crisp and his co-conspirators.

I had an interesting conversation with an agent from a local real estate company I will keep nameless at the Blaze game on Thursday.  According to him, the revelations about Crisp only touch the surface and by the time the investigations are done, more than a few agents and companies will be going down with him. Apparently there were some cross-company dealings going on there were not above board.

Thanks for all of the interesting comments. To Bakersfield Bubble, I know this was happening 2 years ago, but I only recently became aware of it. I read your BLOG and you have some very interesting information. I am curious about your identity, but I can see why you would want to maintain your anonymity. I see that you have a second BLOG, not on the Bakersfield Californian, and a website. Anyone wanting to learn more about what is going on should check it out. I think you can find it from links on his BLOG.

Thanks everyone else, and I enjoyed the article about what is going on in Florida. I suspect that it was similar to what happened here, but even more extreme.

I talked to Jason from the Californian, and he said that I couldn’t just put an open house notice on this Blog, so he deleted that post.

I also posted that I was looking for a home for a stray dog. If anyone is interested, he is still available, but since I named him Miles I started to enjoy his company. I already had two dogs, Dusty and Delilah. Dusty was from Wasco Animal Shelter, and Delilah was from a flyer I saw at Kroll Park. I was going to place Miles in the SPCA, as he was a friendly young puppy, he would probably be adopted. But they are full, and you have to keep trying to get in. At least they don’t  euthanize.

But I was less than enthusiastic about finding a place for Miles, and I guess it was because he is such a friendly guy, and he fit right in with the other two.