"You've Caught the NET!"

This is very disturbing, folks - but I'm sure it also happens where you live and work.

Here in Cook County, the county which includes the City of Chicago, as well as neighboring suburban Du Page County, scam artists are beginning to record forged Quit Claim Deeds to transfer properties to themselves in alarmingly increasing numbers.

After the deed is forged then recorded, the new "owner" enlists this help of a scam-friendly mortgage broker, and appraiser.  He re-finances with cash out, or takes a hefty home equity line of credit draw, against the property he "acquired."  Then - he is GONE.  And, often, the equity, and credit, of the duped homeowner.

Many of these scam artists have intercepted small postcards notifying legitimate homeowners of the Quit Claim Recording.  Of course, they never make a mortgage payment, and the property gets foreclosed upon - even while the real homeowner is still making mortgage payments!

In fact, Eugene Moore, the Recorder of Deeds here in Cook County, found out his own cousin was nearly duped out of her property recently, and was saved when the law intervened.

Moore is now training his cashiers and clerks to spot red flags - deeds recorded with cash payments, obvious forgeries.  But the Recorder's Office has no authority to arrest the bad guys - but they hope to make progress, by adding more staff to keep better watch.  According to Recorder Moore, with over 5,000 legal documents being recorded in Cook County every business day, it is tough to spot every fraudulent deed .

In Wayne County MI, which includes Metro Detroit, the County Register of Deeds, Bernard Youngblood, has fought an effective campaign against mortgage fraud scam artists since 2005.  He has a task force that often sits in on suspect closing, nabbing culprits before title changes hands!  He claims a 100% conviction rate on those he catches in the act!

Often, lenders are red-faced by the scam, and fail to report their loss.  One scammed home, in prestigious Grosse Point MI, was appraised and mortgaged for double its $1 Million Dollar Value.  The "buyer" never made a mortgage payment, and foreclosure proceedings began.  The lender elected to eat their losses, ratehr than prosecute.

Here in Chicago, in the South Side Kenwood Neighborhood, a legitimate Warranty Deed drawn and recorded in 1996 was forged and quit-claimed in 2006.  When the property sold in foreclosure auction early this year, the new owners, upon inspection, found the years-old skeleton of the previous owner's son, who was long dead in the home.

Have you heard of this scam in your market area?  Please let us know!

I would imagine, in today's real estate market, in Chicago and elsewhere, lenders are being more vigilant about granting unverified lines of credit.    But, even then, I'm sure a few might slip through the cracks.

Please review our post today at BlogChicagoHomes.com for more info, and a link to Susan Chandler's article in last Saturday's Chicago Tribune.

DEAN & DEAN'S TEAM CHICAGO