Hawaii Randy's Real Estate Opinions: May 2009

On Tuesday a letter was issued by HUD letting us know that the $8000 first time home buyer's credit could be used for down payments for FHA loans.  A few news stories broke out immediately following that exciting news.  At least we thought it was exciting news.  Within a couple of days the story reversed.  Never mind, HUD withdrew the letter.  They were only kidding.

After sending out what I thought was exciting news, I had to send out another message a day later to my clients and fellow real estate professionals, letting them know that the HUD letter and information I sent out was not accurate.

THANK YOU, Jeff Belonger!  Jeff the FHA expert who posted a blog article that did a wonderful job of clearing up the confusion created by HUD: 

Using First-Time Homebuyer Tax Credits for the Downpayment - It's GONE !!!! - The story of the $8,000 tax credit  

In our local news there has been a series of stories about a mortgage broker team who were committing mortgage fraud.  They were also trying to trick people out of their homes. 

The wife mortgage broker’s wife set up a fake escrow company and used shill buyers to supposedly help folks refinance their homes.  They told people they were temporarily putting the deeds in the names of the shill buyers to make the refinance work and the cash they got out would be held in escrow to help make the mortgage payments.   They later tried to evict the duped owners.  One of the owners turned them in and the prosecutors shut them down.  Legal action has been taken to keep the one owner in their home, but the deed is still in the name of the shill buyer.

The public needs to have their guards up.  Those of us who are truly professionals need to be extra protective of our clients and be on the lookout for scam artists.  Folks who are in a distressed situation are particularly vulnerable to folks like this.