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 March 20, 2010

MANY MORTGAGES IN DEFAULT FOUND TO BE BASED ON FRAUD
As part of the second day of the Financial Crisis Inquiry Commission's findings, it was discovered that Miami, Florida is one of possibly many areas that are apparently rampant with fraudulent mortgages.
An attorney for the Miami-Dade Police Department stated that, in their pursuit of fraud in the issuance of mortgage loans, has discovered that nearly seventy percent of the mortgages that are in default contain some degree of fraud.

This fraud can be traced to the borrower, who was dishonest in reporting their income and/or assets in order to obtain a loan that they would have otherwise not been able to receive, and/or the lender who misleads the borrower by leading them to believe that the mortgage stipulations are very different from what they actually are. Dishonesty, manipulation and high-pressure tactics have been used in order to persuade the often naïve borrower to use a particular lender.

While this number of fraudulent mortgages seems to be surprisingly high, it at least in large part explains why thousands of mortgages are currently in default.