Mr Medved

Liar loans/foreclosuregate Aussie Style

19 posts in this topic

Anecdote from a very credible source. The story relates to a low-doc loan application.

A woman in NSW applied for a low-doc loan through a mortgage broker, the loan was with one of the big four... a naughty aughty bank. Several months (or a couple of years) later a debt collector turned up at her place coming to repossess large, heavy machinery (e.g., wrecking ball, bobcat). She didn't own any of this so said 'go for your life!'

She contacted the bank and demanded to see all the paperwork. The bank refused and suggested she take out a new mortgage (refinance). With a bit more digging she uncovered quite a bit of dirt (with the help of the police).

The mortgage broker who received the application had skipped VIC and the ACT on various charges, and was operating under 50 aliases. The original application was used to forge loan documentation, and in turn forge company registration documentation and paperwork sent to the ATO (tax returns, etc), which claimed purchase of the heavy machinery, etc. The bottom line - the mortgage was forged. They claimed to the ATO that the woman was earning $500k a year. If that is not enough, the amount of the loan provided was $70k more than in the application.

Although it wasn't clear, I believe one of the four suspects connected to the McGurk murder (property developer in Sydney) is the said mortgage broker (or connected to one of them).

The bank tried to repossess her house two years ago but she is still living in it.

I was informed there are 60 detectives currently working on this. I was also told, though this may just be speculation, that all the big four are involved in such practices and that this was common practice.

The fallout is likely to be enormous. This is some very serious sh*t. This may very well be our own version of liar loans/foreclosuregate etc. How are those bank options...?

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The thought of an aussie equivalent did cross my mind when reading about the US problems, but we'd need to know about the relevent australian rules and regulations to find out if there have been breeches to the extent they've had there.

My gut feel is it's likely confined to the non-bank sector if it's happened at all, as that's where lending was dogiest here. Still could be significant as they were responsible for a lot of lending over the last decade, and by the very nature of taking on the highest risk borrowers, are most likely to be involved in foreclosures.

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we'd need to know about the relevent australian rules and regulations to find out if there have been breeches to the extent they've had there.

Just to be clear - in this case the broker (and/or bank) forged loan documents, and falsified company registrations and tax returns by lifting the woman's signature from her loan application. That is fraud, the only real question is how widespread the practice was/is.

The source did mention that this was a front for laundering drug money, though no details were provided so it may have been speculation. The link to the McGurk murder was not speculation, and I have no doubts that rabbit hole will go very deep... could be very Abe Saffron-esque.

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I geuss it's just wait and see then. Like America, it will probably need an increase in the number of foreclosures to uncover this sort of thing.

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Mass Media said something about this being a bit of a ring. Something like 100 / 150 people involved.

My opinion is that when a scam is that widely known it is not smart people involved. And generally involves more than one ring.

The whole property thing has been too juicy for any predator to avoid. When councils start putting up rates because they see the cash flow you know everyone is in on it it, they are after the equivalent of the proverbial shoe shine boys.

Sort of like super I guess. If everyone puts their money in a big pile with everyone elses money then there are sure to be an entire ecosystem of predators feeding off the bait ball.

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The Madoffs are proud of such creativity..

When Ms Coppers met Ms Thompson she was a rising star in the trade, hailed in one industry publication as being in the nation's top-10 mortgage brokers for helping banks dish out more than 300 loans totalling $110 million in 2007 alone.

http://au.news.yahoo.com/thewest/a/-/mp/5819332/duped-investors-face-financial-ruin/

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More on this here:

http://www.aph.gov.au/senate/committee/corporations_ctte/fps/submissions/sub186.pdf

Also in this meeting they saw that I was unwell and asked about my condition, a degenerative muscle disease called Chostochondritis. I had made my broker/planner aware that I was unwell with this disease before she refinanced to Homeloans/BOA.

They admitted that there was fraud on the application but that they were not insured to cover this but if I applied under a medical condition to annul the loans that they would be able to cover this. I have a witness that was with me in the meeting that can attest to them acknowledging fraud on the application but that they asked for me to apply under medical issues.

After I made the application it was used against me as BOA then attempted to take my home on Christmas Eve saying that because “I was unable to work they were therefore unable to negotiate any assistance.”

Suspect Genworth might want to look into the bold bit. :ph34r:

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Developer Ron Medich has been charged over the McGurk murder today

Sydney property developer Ron Medich has been charged over the alleged murder of businessman Michael McGurk, who was gunned down outside his Cremorne home last year.

Will be very interesting to see what comes out of the trial.

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Is anybody else getting fond memories of countless threads at somersoft/elsewhere?

"HELP! We've hit our serviceability limit! Bank won't lend us any more money!"

The responses were typically:

"Get a better mortgage broker..."

Fortunately the banking sector in general has tightened up and even a good broker won't get you over the line. Lo-docs used to be the way to do it (you could get a lo doc at any LVR for any amount of money and almost put any number you like down as 'income') but now the only 'easy' lo-doc to get is a 60% LVR one, and people trying to do silly things typically don't have a 40% deposit.

Now you see a lot of threads of people after 80% no proof of income lo-docs, which still exist but are pretty rare.

There's a lot less crazies chasing property at any cost now to get a multimillion portfolio of negatively geared property in the shortest time possible. Unfortunately by 'less' I don't mean 'none'.

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Pretty simple really. I, the mortgage broker "embellish" your credentials, income and "suppress" your financial commitments and secure you a higher (interest only?) loan, pocketing a higher commission. Its all good while you keep paying the loan.

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Pretty simple really. I, the mortgage broker "embellish" your credentials, income and "suppress" your financial commitments and secure you a higher (interest only?) loan, pocketing a higher commission. Its all good while you keep paying the loan.

The thing is, in this case the woman only made an application. Unbeknownst to her the loan was created... as well as fraudulent company registrations and tax returns. She only became aware of this once the interest payable exceeded the amount of the loan.

Allegedly, the gunman in the McGurk murder was a young guy hired by someone else.

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I was talking about Kate Thompson doing it USA style.

Ms Thompson she was a rising star in the trade, hailed in one industry publication as being in the nation's top-10 mortgage brokers for helping banks dish out more than 300 loans totalling $110 million in 2007 alone.

The McGurk thing is a mini series and a Royal Commission (into NSW Labor) in the waiting.

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soulds just like the 4 corners story about phone accounts done with mcquarie bank, and the phone complanies forging everything , and on selling the contracts.

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This article is from the U.S. but gives you a glimpse of what may be happening behind the scenes after you take out a mortgage.

http://www.zerohedge.com/article/just-when-you-thought-you-knew-something-about-mortgage-securitizations

post-208-006084400 1289860057_thumb.jpg

Thanks for the post Medved.

Oh my goodness! :shocking:

"Oh what a tangled web we weave, when first we practice to deceive." Sir Walter Scott.

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As one of those people who actually *needs* a liar's loan (they're called stated income loans btw) I can report that about 6 weeks ago CBA changed their policy and they don't do them anymore. And their exit fees suck mightily.

So we're off to another bank that does do them ... the things you do to get a loan at a miserably low LVR that we can afford and then some ... but hey, it takes too long to save $70k and I can't see us selling our old house in time for the new one with no overlap, so grovelling to the banks it is. The irritating thing is that if we decide to rent out or sell our current house, either the rent will pay both mortgages or the sale proceeds will clear both mortgages, so its not like we can't afford it ... its just that without a stated income loan, between the bank dictating what we spend (they tell YOU what you spend, you can't tell THEM what you spend) and ignoring about 30% of our income they just won't do it fulldoc. Grrr.

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Developer Ron Medich has been charged over the McGurk murder today

Will be very interesting to see what comes out of the trial.

Those legal bills must be hurting!

Medich home on market for $40m

THE Point Piper mansion owned by accused murderer Ron Medich and his wife, Odetta, hit the Domain website today.

Described as an ‘‘architectural triumph of unrivalled quality’’, agents are seeking expressions of interest above $40 million.

That’s a $15 million ‘‘discount’’ on the $55 million the Medichs reportedly wanted when the Wolseley Road waterfront was quietly listed for sale last February. The property has never before been marketed in print or on the internet.

Ron Medich was arrested in October 2010 over the 2009 murder of his business associate Michael McGurk. The matter is due for a mention in court tomorrow. He’s been on bail, wearing an electronic bracelet that monitors his movements, residing in a city apartment overlooking St Andrew’s Cathedral.

Now estranged from his wife, Mr Medich had been living in the five-bedroom, seven-bathroom home until his arrest.

The Mediches commissioned the architect David Katon to design the home, which has some of the best views in Sydney.

Australian Property Monitors records show the couple had bought the original home for $15,150,000 in July, 2003 from restaurateur Wolfie Pizem. He’d paid $160,000 for the 783 sq m property in 1978.

The house is now listed with LJ Hooker Double Bay agent Bill Malouf and Ken Jacobs of Christies, who have been instructed not to comment.

Last February’s reports of $55 million-dollar hopes had amused some agents. That was no doubt based on the sale of the waterfront, Villa Veneto, nearby which Malouf reportedly sold for $53 million in 2010.

However, prestige agent Brad Pillinger said the Medichs’ house was now priced about right. ‘‘If they’re quoting $40 million, I reckon it will sell.

‘‘It’s a once in a lifetime opportunity.’’

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