Shot-gunning is when a fraudster acquires a property through
any one of the following tactics: foreclosure fraud or quit claim deed. Both have nearly the same process and
result. A person facing foreclosure is told by a
Foreclosure Bail Out Specialist that they will handle the situation. The homeowner is told to quit claim the property
back to fraudster. A lease buy back with
homeowner is created; they are told that they will get their house back within
2 to 3 years. The fraudster brings the loan
current and then sells the house out from under the homeowner. The homeowner is than evicted.
Many times equity skimming occurs by the fraudster. While all of this is happening, the fraudster
applies or has a "straw-buyer" apply for Equity Lines of credit,
otherwise known as a second mortgage on the property. What lenders do not know
is that the fraudster is actually applying for sometimes between 8-10 Equity
lines all at once, using a variety of lenders.
The Credit Report will show numerous inquiries, but to cover their
tracks, the fraudster has a letter added to their file which states "I am
shopping for the best rate".
Unknowingly, many lenders approve the Equity Lines. Unfortunately, the lenders do not know of the
other lenders until they find out that they are not the 2nd lien position but
in the 8th or 10th lien position on a property that due to market value can’t
cover all those liens.
How To Protect Yourself
Know who you are doing business with. Verify all information on the person or
Do background check, and be thorough.
Verify that the Mediation Specialist is licensed.