Entries Tagged 'Mortgage Fraud' ↓

Robert Palano, formerly of Clarence, NY, targeted low income homes to the city of Bufallo and with the help of  appraiser Michael Heigel, over inflated the property values to commit mortgage fraud. The New York State Attorneys Office filed charges in the matter and Robert Palano plead guilty to multiple felony counts of mortgage fraud. This is the second time Palano has plead guilty to fraudulent real estate practices.

Robert Palano, 51, faces two-and-one-half to seven years in prison on the felony counts. The former Clarence resident, now living in Florida, has under a civil action, also agreed to pay $1.5 million in restitution and penalties.

Additionally, Michael Heigel, who worked as an appraiser on more than 100 properties purchased on Buffalo’s East Side, will pay $55,000 for over-inflating the value of those homes, many of which ended up vacant and boarded up in a depressed area of the city.

Investigators looked into Palano’s real estate dealings from 1998 to 2002. The AG’s office concluded Palano fraudulently obtained more than $4 million dollars in mortgage loans on 104 rental properties he owned. After pocketing the loan proceeds, Palano relocated to Florida, leaving at least ten lenders with defaulted loans secured by properties worth far less than the debt, and tenants being evicted through foreclosures, authorities said. via Business First of Buffalo:.

The practice of providing bailout money to save people about to have their mortgage forclosed upon is fairly prevalent in Illinois. Very often the people being bailed out from a mortgage they can not repay end up with such a bad deal with the bailout agent, they are unable to become whole in the process and still lose the house. The state legislature has come up with some alternatives to provide some legal protection against those being bailed out and unable to protect themselves.

A bill that would allow struggling homeowners to back out of suspect mortgage “bailout” deals passed the Senate Monday and went to the governor. The bill puts restrictions on a burgeoning industry that promises to save the homes of cash-strapped owners, but has been linked to numerous scams.

Under the legislation, bailout firms would have to detail their services in writing, and homeowners would have greater flexibility in canceling the agreements. In the controversial bailout deals, a homeowner deeds his house to an investor for a year, hoping to use that time to get out of debt and repurchase the home with a fresh mortgage. Instead, critics say, the home is often lost in the process. via the Chicago Tribune