Florida once again was rated the top state for mortgage fraud, according to a report released Monday by the LexisNexis Mortgage Asset Research Institute.
Florida also held the annual report’s top spot in 2006 and 2007, but was replaced in 2008 by Rhode Island. New York was in second place behind Florida, followed by California.
The Miami-Fort Lauderdale region ranked fourth among the metropolitan areas studied, institute researchers found, accounting for 4 percent of all mortgage fraud reported nationwide. The New York-New Jersey-Long Island area was first, followed by Los Angeles-Riverside and the tri-state Chicago-Gary-Kenosha region.
The report looked at incidents of alleged fraud and misrepresentation reported to lenders, agencies and insurers to the Mortgage Industry Data Exchange, or MIDEX. Researchers also analyzed 67,190 suspicious mortgage activity reports submitted last year to the U.S. Treasury Department’s financial crimes division.
The LexisNexis rankings come through a formula that balances reported fraud incidents with the number of loans originated for properties in that state. Florida had almost three times the amount of fraud or misrepresentation reports as what would be considered normal for the number of loans.
Analysts were particularly concerned about skyrocketing incidents of appraisal fraud nationwide, with Florida having the highest rates of this activity in the country. The most common practice was inflating, fabricating or incorrectly reporting comparables, seen in 36 percent of loans nationwide flagged for fraud.
Darius Bozorgi, CEO of Veros Real Estate Solutions, which assisted in compiling the report, blamed the poor housing market. “Florida is the No. 1 state for depreciating home prices. So it’s really no surprise that Florida is the No. 1 state for fraud,” he said.
This year may remain grim for Florida. The Veros VeroFORECAST report, which projects market trends over the next 12 to 18 months, recently listed the five anticipated weakest markets nationwide. All were in Florida, although none in South Florida, with the Daytona Beach area the first with a 10 percent drop in values.
On a brighter note, Florida and New York showed dramatic declines in mortgage application fraud from 2008 to 2009, although it remained the most common form of mortgage malfeasance.
Mortgage incident reports nationwide went up 7 percent from 2008 to 2009, the report found. The institute and Veros called on government and the mortgage industry to be increasingly vigilant, as fraudulent brokers and loan originators are using more sophisticated methods.
“Fraudsters are taking advantage of desperate consumers and confused consumers,” said Denise James, director of LexisNexis Risk Solutions and a report co-author.
Diane Lade can be reached at dlade@SunSentinel.com or 954-356-4295.
Copyright © 2010, South Florida Sun-Sentinel
Tags: Broward County, First Time Home Buyers, Florida, Ft Lauderdale, Home inspection, Home Inspections, home sales, Miami, Miami Dade County, Miramar, Pembroke Pines, real estate transactions, South Florida, Sunrise
Most of us have learned the hard way that a home will not maintain itself and we ought to budget for routine maintenance and repair for the house and yard. Large, irregular expenses will occur as our homes age. Large expenses such as interior and exterior painting, repairs or replacement of the heating and air conditioning units and appliances, floor coverings and roof surfaces. Most experts recommend setting aside 1-3 percent of the market value of your home each year to pay for maintenance and repair costs. Even though all of these funds may not be needed if your home is new, the accumulated amounts will help you prevent a budget crisis when it is time for large future expenses such as re-roofing or replacing a heating unit. Preventative home maintenance helps provide a healthy, safe environment and it protects your growing investment. Have a qualified home inspector inspect at least every ten years.
Tags: Broward County, First Time Home Buyers, Florida, Ft Lauderdale, Home inspection, homewoners, Miami, Miami Dade County, Miramar, Pembroke Pines, repairs, South Florida, Sunrise
1 .Mark and monitor small/hairline cracks in foundation. If stable after a few months fill
with epoxy. If they’ve expanded beyond one half inch, call a structural engineer.
2. Inspect basement/crawl spaces for seepage/leakage.
3. Inspect roof for any missing, loose or damaged shingles.
4. Check and clean AC/furnace systems. Follow the manufacturer’s recommendations
5. Clean and/or replace the AC/furnace filters. Adjust thermostats for season change.
6. Check and clean gutters, downspouts and extensions and repair/replace as needed
7. Do a safety check: smoke detectors, fire escape routes, fire extinguisher, carbon
monoxide alarms and window locks.
8. If you have a fireplace check flue to make sure it is closed for warmer weather.
9. Scrape, caulk and paint any wood surfaces that have peeled or weathered.
10. Clean and inspect your lawn mower and other power tools and equipment.
Tags: Broward County, First Time Home Buyers, Florida, Home Safety, Miami, Miami Dade County, Miramar, Pembroke Pines, safety, South Florida, Sunrise
A home in Parkland built with Chinese drywall recently was gutted. The $1.7 million home was built by now-bankrupt developer WCI Communities. The cost to fix the problem: $220,000.
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Consumer advocates hailed a ruling Thursday in Louisiana federal court that awarded $2.6 million to seven Virginia families who bought homes built with Chinese drywall.
U.S. District Judge Eldon Fallon handed down the first award in a Chinese drywall lawsuit. He awarded property damages, personal property damages, and an amount for loss of use and enjoyment.
The case is considered a bellwether for numerous federal class action lawsuits consolidated in New Orleans. It also provides guidance for hundreds of other cases awaiting trial in state circuit courts.
The ruling lends legal weight to a recent federal policy decision that the only safe method of dealing with Chinese drywall is to gut a house’s interior of all drywall, wiring and plumbing.
“Proper remediation for the [plaintiffs] is to remove all drywall in their homes, all items which have suffered corrosion as a result of the Chinese drywall, and all items which will be materially damaged in the process of removal,” Fallon’s order states. “Accordingly, the court further finds that the plaintiff-interveners are entitled to recover damages.”
Fallon used a formula of $86 a square foot for a typical home, and awarded $100,000 to most of the seven families for loss of use and enjoyment. But, recovering from the Chinese company that made the drywall –Taishan Gypsum – may be more problematic. Taishan was served notice of the suit, but failed to respond, and a default judgment was entered against it in a previous ruling.
Although the case involved homes in Virginia, most were built using Chinese drywall in Florida and Louisiana during the construction boom.
Chinese drywall has concentrations of sulfur and other substances that produce corrosive gases and odor, which leads to corroded metal. From 2004 to 2006, when the building boom and hurricane repairs created a domestic shortage, 500 million pounds of drywall were imported – and 60 percent of the drywall came through Florida ports.
The American Association for Justice (formerly the Association of Trial Lawyers) hailed the ruling as a reason to pass federal legislation cracking down on foreign manufacturers who do business in the U.S.
“Taishan Gypsum profited from a product they sold here in the U.S. that has now proven to be defective, costing millions of dollars in damage, decreased property values,” AAJ President Anthony Tarricone said in a news release.
“While the ruling today holds the company responsible, there is no guarantee the company will comply, leaving U.S. consumers and homebuilders to pick up the tab,” he said. “This is why it is critical we pass the Foreign Manufacturers Legal Accountability Act, so foreign manufacturers are held to the same standards and justice system as U.S. manufacturers.”
Coral Gables attorney Ervin Gonzalez, of Colson Hicks Eidson, said the ruling “tells other parties how the law is being interpreted and what to expect in similar cases.” Gonzalez is handling several cases for homeowners with Chinese drywall. He also sits on the plaintiffs’ steering committee for the consolidated federal cases. Gonzalez said he expects Fallon to take up one of several cases from Florida this summer.
U.S. Sen. Bill Nelson, D-Florida, also praised the ruling. “This is a legal determination of who’s at fault in the drywall mess,” he said in a release. “Now homeowners have somebody to put in their sights. Meantime, I’m going to keep pushing our government hard to step up the pressure on the Chinese to get the companies over there to pay up.”
Fallon’s ruling enshrines several scientific findings about Chinese drywall into federal case law, most of which had been made public in previous studies:
- Chinese drywall has a significantly higher average concentration of strontium and significantly more detectable levels of elemental sulfur.
- Chinese drywall releases reduced sulfur gases.
- The sulfur gases released by Chinese drywall are irritating to the human body.
- The sulfur gases cause offending odors in homes, making them hard, if not impossible, to live in.
- The sulfur gases are corrosive to metals, particularly copper and silver.
- The corrosion on metals caused by the sulfur gases causes premature failure of electrical and mechanical devices.
- The corrosion on metals caused by the sulfur gases emitted by Chinese drywall poses a fire risk.
Read more: First Chinese drywall suit award: $2.6 million – South Florida Business Journal:
Posted by Bill Siegel Florida Home Inspection Team Inc.
Tags: Broward County, Chinese Drywall, First Time Home Buyers, Ft Lauderdale, Hallandale, Home inspection, Miami, Miami Dade County, Miramar, Pembroke Pines, real estate transactions, South Florida, Sunrise
We hear about these all the time. Our company just inspected a 6000 square foot house. The night before the inspection my client calls me and tells me that the selling Realtor has a report that was done a month ago and there is no reason to have another inspection. His charge for this inspection was $325.00 and ours was $725.00. There is no way an inspector can inspect a house of that size, with three air conditioners and a swimming pool for that price. That inspection should take at least 8 hours, if not longer. Well, my client decided to have us do the inspection. Not only did we find the obvious minor things that the other inspector found, but we found wet walls (the other inspector never used a moisture meter), bad AC thermostats, damaged widows, damaged doors, and numerous other deficiencies that were not listed in the first report. When you are buying a house, you need to understand that sometimes you may get exactly what you are paying for. We spend time on these inspections and base our price on the time needed to complete a good inspection for our client, also taking into consideration the size an age of the house. If you skimp on your inspection, you may be sorry later.
Posted by Bill Siegel Florida Home Inspection Team Inc.
Tags: Broward County, First Time Home Buyers, Florida, Ft Lauderdale, Hallandale, Home Inspections, home sales, Miami, Miami Dade County, Miramar, Pembroke Pines, real estate transactions, South Florida, Sunrise
