Real estate fraud can take many forms. Some examples of real estate fraud include foreclosure bailout, home equity fraud, home renovation scams, rental fraud, and deceptive timeshare scams. Foreclosure bailout schemes involve promises to rescue a home in foreclosure while renting the home back to the original owner. The con artist fails to make mortgage payments and the victim inevitably winds up in foreclosure. A similar scheme involves offering a refinancing loan which the homeowner will never be able to repay. Home equity fraud schemes involve door-to-door contractors who also arrange financing for their work through a home loan. Often there is no "improvement" at all. The work is substandard or left incomplete. The homeowner generally ends up deeply in debt and in grave danger of foreclosure after contractors are long gone. Rental fraud involves a con artist renting property which they don't own, such as an abandoned or vacant property, and disappearing after collecting rent and security deposits. In timeshare scames, con artists may make oral promises that are omitted from the written contract. They may also fail to mention fees and obligations that are in the written contract, which are never mentioned orally. The extent to which the annual maintenance fee will increase over time, special assessment fees, or the difficulty to resell a timeshare are not disclosed.
There are also common schemes involving real estate loans, such as:
Real estate fraud takes other forms, and the remedies vary upon the type of fraud perpetrated. Some remedies may include criminal prosecution, recission of contract, punitive damages, and IRS penalties, among others.
