Courtesy of FBI.gov

Stories about the current mortgage crisis and the fraud that goes with it are not only all over the news these days but also the source of an increase workload for the Federal Bureau of Investigation. The FBI says its caseload has more than tripled in the past five years. And it reported that, from March 1 to June 18, 2008, a multi-agency effort called Operation Malicious Mortgage led to 144 mortgage fraud cases in which 406 defendants were charged. Losses in these cases were estimated at $1 billion.

Some recent mortgage fraud statistics from the FBI:

• Estimated annual losses are $4 billion to $6 billion.
• There were 46,717 mortgage fraud suspicious activity reports in 2007, with $813 million in losses reported.
• The states with the most significant mortgage fraud problems in 2008 are, in order: Florida, Nevada, Michigan, California, Utah, Georgia, Virginia, Illinois, New York, and Minnesota.
• There were 1,380 pending mortgage fraud investigations as of May 2008.
• In 2007, 462 new cases were opened, compared to 295 in 2003.
• In 2007, there were 321 indictments and 260 convictions.

If you’re having a tough time making your mortgage payments, you might be tempted by emails or Web-based ads from companies claiming they can help you eliminate mortgage debt if you pay an up-front fee for them to do the paperwork. But the FBI has only one thing to say about this: “It’s a scam.”

And if you’ve been told by your lender that you are facing foreclosure, be especially alert for the scam in which a perpetrator convinces a homeowner to “temporarily” sign over the house deed for a fee. The homeowner loses the up-front fees, and the perpetrator often turns around and sells the house, leaving the owner on the street.

Instead of turning to these “solutions,” the FBI says to contact your lender before your situation gets too bad. Because lenders are dealing with a large number of foreclosures, they “don’t want your house, and most will work with you to help you keep it,” says Special Agent Scott Broshears, a mortgage fraud supervisor with the FBI.

The FBI advises consumers to take the following steps to keep from becoming a victim of mortgage fraud:

Get referrals for real estate and mortgage professionals when you want to buy or sell a home. Check out their licenses with state, county, or city regulatory agencies.

Do your own research into what other homes in the neighborhood have sold for. Also look into recent tax assessments of neighborhood homes.

Beware of “no money down” loans. They’re a gimmick used to entice people to buy a home they really can’t afford.

Don’t make false statements on your loan application. Even if a realtor or mortgage broker says otherwise, don’t overstate your income or lie about where your down payment is coming from.

Never sign a blank document or a document containing blank lines. Be sure to read and review all loan documents signed at closing. If you don’t understand what you’re signing, get an attorney who can review the documents for you.

“And while some of these steps may require you to do a little extra work now,” says Broshears, “in the long run it may save you aggravation, money, and even your house.”