Recommended reading from this morning’s Wall Street Journal:

Recommended Reading for March 12, 2007
By Keith Huang – The Wall Street Journal

Detroit-based realtor Ralph Roberts has been selling real estate for more than 25 years. In recent years, Mr. Roberts has turned his attention to real-estate and mortgage fraud.

Mr. Roberts has even worked with federal officials to educate state and local law enforcement, regulators and financial institutions on how to detect and avoid common real-estate scams.

Some of the more common schemes include property flipping with false statements to lenders, or the use of fraudulent qualifications, such as a buyer fabricating an employment history or credit record.

Mr. Roberts says con artists have increasingly been turning to the Web to perpetrate their scams. To combat this rise, he has helped nurture an online network of fraud busters.

According to a recent report by the Internal Revenue Service, the booming real-estate market has been complemented by an increase in real-estate-related schemes. In fact, the IRS said the number of real-estate fraud investigations the agency initiated doubled between fiscal 2001 and fiscal 2003.

Mr. Roberts, who has written numerous books on the subject, runs FlippingFrenzy.com, a blog about real estate fraud. He’s also a contributing author to “Flipping Houses For Dummies.” More recently, he and Rachel Dollar co-wrote Protect Yourself Against Real Estate and Mortgage Fraud,” which is scheduled for publishing this summer.

Here is a selection of Web sites from Mr. Roberts.

MortgageFraudBlog.com, MortgageFraudBlog.com

“Hosted and maintained by nationally recognized mortgage-fraud expert, Rachel Dollar, this blog delivers the daily buzz on mortgage fraud. Visitors can also learn about what mortgage lenders, real-estate professionals, law enforcement agencies, legislators, and community activists are doing to stop it.”

Georgia Real-estate Prevention and Awareness, GREFPAC.org

“Georgia is the first state to have officially declared mortgage fraud a crime, and one of the key driving forces behind the legislation was Georgia Real Estate Prevention and Awareness (or GREFPAC). Here, you can learn more about the group and find out what you can do in your own community to curb real-estate and mortgage fraud.”

Stop Mortgage Fraud, StopMortgageFraud.com

“This is an excellent site for consumers who may suspect that they’re about to become the victim of predatory-lending practices. The site features a borrower’s bill of rights, a list of warning signs that commonly indicate abusive lending practices, as well as information on how to report suspected incidents of predatory lending.”

Freddie Mac’s Don’t Borrow Trouble, DontBorrowTrouble.com

“On behalf of mortgage lenders and homeowners, Freddie Mac has created this site to promote its ‘Don’t Borrow Trouble’ program. Homeowners who have trouble maintaining their monthly mortgage payments can learn how to regain their financial footing without falling prey to predatory lenders. This is also an excellent Web site for homeowners who are facing foreclosure.”

U.S. Department of Housing and Urban Development (HUD), HUD.gov

“HUD provides a vast amount of reliable information about renting, buying, owning, and financing the purchase of homes. The site also features articles on fair housing, foreclosure, subsidized housing and home improvements. This site is excellent for first-time buyers and established homeowners.”

Realty Times, RealtyTimes.com

“Realty Times is the leading Real Estate News site on the Internet for both consumers and real-estate professionals. Although the site’s offerings are not exclusively dedicated to topics related to real-estate and mortgage fraud, it regularly features articles about the overall health of the real-estate industry.”

Inman News, Inman.com

“Inman News features articles and commentary from a wide selection of the top residential and commercial real-estate experts across the country. Articles cover everything from current mortgage-interest rates to tips for real-estate professionals and investors. The site also includes regular features on real-estate and mortgage fraud.”

RISMedia, RISMedia.com

“Founded in 1980 by CEO and Publisher John E. Featherston, RISMedia is committed to being the definitive source for news and information pertaining to residential-real estate. The site’s content is primarily directed toward residential real-estate professionals and includes regular features on real-estate and mortgage fraud.”

Conference of State Bank Supervisors, CSBS.org

“Whether you’re in the mortgage loan industry or a consumer, this site shows how CSBS and other mortgage banker associations are working together to curb abuses in the industry.”

Star Power, GoStarPower.com

“Headed by Howard Brinton, Star Power is dedicated to bringing top producing real-estate agents [Stars] together to share their proven tips and strategies. Click the Products link to find out more about STAR POWER Systems ‘Detecting and Preventing Real Estate Fraud’ program.”

EDITOR’S NOTE: Because of the intense and often off-topic nature of many of the comments left for this blog entry, commenting has been turned off, and all unrelated comments have been deleted.
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As I’ve mentioned before, I contribute articles on a monthly basis to RealtyTimes.com, a leading real estate industry web site that over the last few years has become one of the real estate industry’s most informative and timely sources of news and information.

Here’s a preview of my latest article:

Cash Back at Closing: Appealing Arrangement or Sinister Scam

Cash back deals are stitched into the very fabric of the U.S. economy. Manufacturers promote their products with cash rebates. Credit card companies offer cash-back on purchases. Even banks dangle cash-back deals to attract new customers. Now, homebuyers and con artists are jumping on the cash-back bandwagon, and plenty of our own people — real estate professionals — are tripping over themselves to cater to them.

On its surface, cash back at closing seems like a win-win situation. The buyer simply pays a little more for a property than it’s worth, and the seller agrees to kick back the surplus cash to the buyer.

For buyers, it can be a savvy financial move, allowing them to pay off outstanding credit card debt or use the extra cash for home repairs and renovations. The seller unloads his house at close to or better than his asking price. The real estate agent gets a bigger commission. The loan officer chalks up another successful loan. And the lender scores a larger loan and stands to earn more interest over the life of the loan.

If anything seems like a win-win situation, cash back at closing is it! But is it legal? Click here to find out.

EDITOR’S NOTE: Because of the intense and often off-topic nature of many of the comments left for this blog entry, commenting has been turned off, and all unrelated comments have been deleted.

As I mentioned back at the beginning of February, I am now a contributing columnist on RealtyTimes.com, a leading real estate industry web site that over the last few years has become one of our most informative and timely sources of news and information.

Here’s a preview of my second article:

Eliminate Your Mortgage in Less Than a Year?:
By Ralph R. Roberts, CRS, GRI

Banks, mortgage companies, and other lenders offer plenty of legitimate ways to eliminate a mortgage. You can borrow less, refinance for a shorter-term loan at a lower interest rate, make payments every two weeks rather than every month, pay a little extra each month toward the principle, or sell the property.

Now, there’s an even better way. Dozens of companies promise to help homeowners completely eliminate their 30-year mortgages in a matter of months for a flat fee of only a few thousand dollars up front!

What a deal! For three thousand bucks or so, all you have to do is kick back in your lounge chair twiddling your thumbs, and in less than a year, you can own your home free and clear, even if you’re facing foreclosure! Even better, you may qualify to cash out tens of thousands of dollars in equity!

Here’s how a typical mortgage elimination scam works:

So, how exactly do these mortgage elimination scams work? To find that out you’ll need to read the article in its entirety by clicking here. And, as I mentioned in February, more of my articles can be found on RealtyTimes.com about once every month or so.

I am very pleased to announce that I am now a contributing columnist to Realty Times, a leading real estate industry web site that over the last few years has become one of our most informative and timely sources of news and information.

Here’s a preview of my first article, ““Flip” — It’s Not Just Another Four-Letter Word”:

The day HUD released FR (Final Rule)-4615 Prohibition of Property Flipping, “flip” became a four-letter word. Utter the F word at a real estate conference or seminar, and you’re liable to be spending your lunch break at a cozy table for one. After all, flipping real estate is unethical, and according to the government flipping is illegal … or is it?

To you and your real estate colleagues, “flip” may very well be a four-letter word, but to the hundreds of thousands of people who tune in to reality TV shows, like Flip This House and Flip That House, flipping is a shrewd and honorable way to earn a buck in real estate.

So, who’s right? Well, to find that out you’ll need to read the article in its entirety by clicking here. And look for additional articles of mine to appear on RealtyTimes.com once every month.