Real Estate News

Click Travel Form and download

Dear readers,

As you know, I have been investing for over 21 years, teaching for over 7 years, writing for 5 and on the radio for 4. In all that time, I have seen, been involved with and researched over 122 different developments across the US and the world. Many of these projects were good. A few were worth my time and my cash. There has never been one that has caused me to literally change me life, re-allocate my resources, sell off all my U.S. real estate and go “all in” on ANY deal. The very thought of it sounds nearly insane…

Until now.

You see, for the past few years, I have been watching and adjusting my portofolio as the U.S. real estate crash fell in around us. Like many developers, 2007 and early 2008 have not been banner years. I was not looking for a home run. I know that real estate is a quiet game of patience. Time+Patience+Money=Wealth. In my 21 years as a professional investor, I have never been bold enough to say that I have found the “Best Deal Ever.” A statement like that would mean that I would have to compare it to deals that I haven’t seen, as well. As a public speaker and radio show host, making a statement like that is dangerous to one’s reputation.

I am making that statement now.

You see, I HAVE found the best deal in the world. To prove it, I have sold off all my assets (Some even at a loss) in order to become MORE involved with this private island project which will definitely and dramatically maximize my wealth, my time, and my lifestyle.  I have taken a sabbatical from my Real Estate academy and decided to focus ALL of my resources towards a 300 acre, private island project in the Caribbean.

Am I the only crazy one? Hardly. Everytime I bring down a dozen or so investors, nearly each one of them comes back nearly as crazy as I do. Nearly all of them lose sleep at the massive potential of investing in this paradise and realizing millions of dollars in safe, secure, private and tax-deferred (or tax free) real estate.

I will tell you that there is NO WAY to explain this island, the opportunity, or the potential to you via words, email, or a phone conversation. Last year, I was as skeptical as you (Probably more). Last year, the owner of these islands made me a simple offer. He said, “Come on down. The worst that can happen to you is that you will have a terrific weekend in paradise and enjoy a few margarita’s on me. ” He went on, “However, if I am even half right, I will blow your mind and be instrumental in taking your 20 year retirement plan and accomplishing it in 3 years.”

Needless to say, that was worth a trip! For around a thousand bucks, I took a few days off and visited this project. I was well armed with my 21 years of experience and the knowledge that I have found things NOT to like about most projects presented to me. Dozens of developers with much more experience and marketing have been trying to impress me, so that I would share the deals with you. I thought this was just another one of those deals.

Boy was I wrong.

To find out more about the HUGE upside of this project, the international players involved (Including heads of state!) and how average people like yourself can TRULY become financially indepedent in a lot less time than normal, send me an email or give me a call. I will not try and “sell” you on the numbers. I won’t even be able to give them all to you. However, I will encourage you to take a weekend out of your life and see for yourself how incredible this project is. You truly won’t know until you put your feet in the sand and see the scope of what will become the crown jewel of the Caribbean in the next few years.

Please download the travel form or drop me a line. I have a few spots left for the upcoming trip and promise you a terrific time!

Click on Travel Form and view or download

Doug Crowe
dacrowe@earthlink.net
1-888-RE-COACH
1-888-732-6224

You see the advertisements in newspapers, on TV, and on the Internet. You hear them on the radio. You get fliers in the mail. You may even get calls from telemarketers offering credit repair services. They all make the same claims:

• “Credit problems? No problem!”
• “We can erase your bad credit — 100% guaranteed.”
• “Create a new credit identity — legally.”
• “We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!”

Don’t believe 99% of these statements. Only time, a conscious effort, and a personal debt repayment plan will improve your credit report. There are legitimate and LEGAL methods, agencies and programs to assist you. Filtering out the bad from the good takes skepticism and common sense.

Springboard is hosting a FREE credit repair workshop at its offices on November 12th or 13th at 7 PM CST. Be sure to register by calling 1-888-RE-COACH. The program will be approximately 30 minutes in length and available online. You can also register by going to www.springboardonline.com .

The Scam

Everyday, companies nationwide appeal to consumers with poor credit histories. They promise, for a fee, to clean up your credit report so you can get a car loan, a home mortgage, insurance, or even a job. The truth is, most can’t deliver. After you pay them thousands of dollars in fees, these companies do nothing to improve your credit report; most simply vanish with your money.

The Warning Signs

If you decide to respond to a credit repair offer, look for these tell-tale signs of a scam:

• companies that want you to pay a large amount of money for credit repair services before they provide any services.
• companies that do not tell you your legal rights and what you can do for yourself for free.
• companies that recommend that you not contact a credit reporting company directly.
• companies that suggest that you try to invent a “new” credit identity — and then, a new credit report — by applying for an Employer Identification Number to use instead of your Social Security number.
• companies that advise you to take any action that seems illegal. If you follow illegal advice and commit fraud, you may be subject to prosecution.

You could be charged and prosecuted for mail or wire fraud if you use the mail or telephone to apply for credit and provide false information. It’s a federal crime to lie on a loan or credit application, to misrepresent your Social Security number, and to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses. Under the Credit Repair Organizations Act, credit repair companies cannot require you to pay until they have completed the services they have promised.

The Truth

No one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete. There is no charge for this. Everything a credit repair clinic can do for you legally, you can do for yourself at little or no cost. Doing it properly, consistenly, and with efficacy is what you need to look for. Most of us don’t have the experience or skills to accomplish this. Of the hundreds of companies that offer help, only a handful deliver. To manage, improve or repair your credit, register for our FREE credit workshop. Click here or go to http://www.springboardonline.com and get started. The workshop is on 12th or 13th at 7 PM CST. This workshop is available at NO COST and will walk you through the specific steps necessary to improve your credit. There will be credit coaching assistance available at a later date…THIS workshop is FREE! Remember, according to the Fair Credit Reporting Act (FCRA):

• You’re entitled to a free report if a company takes adverse action against you, like denying your application for credit, insurance, or employment, and you ask for your report within 60 days of receiving notice of the action. The notice will give you the name, address, and phone number of the consumer reporting company. You’re also entitled to one free report a year if you’re unemployed and plan to look for a job within 60 days; if you’re on welfare; or if your report is inaccurate because of fraud, including identity theft.
• Each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — is required to provide you with a free copy of your credit report, at your request, once every 12 months.
  The three companies have set up a central website, a toll-free telephone number, and a mailing address through which you can order your free annual report. To order, click on annualcreditreport.com, call 1-877-322-8228, or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You can print the form from ftc.gov/bcp/conline/edcams/credit/ . Do not contact the three nationwide consumer reporting companies individually. They are providing free annual credit reports only through annualcreditreport.com, 1-877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You may order your reports from each of the three nationwide consumer reporting companies at the same time, or you can order your report from each of the companies one at a time. For more information, see Your Access to Free Credit Reports at ftc.gov/bcp/conline/edcams/credit/ .
  Otherwise, a consumer reporting company may charge you up to $9.50 for another copy of your report within a 12-month period.
• You can dispute mistakes or outdated items for free. Under the FCRA, both the consumer reporting company and the information provider (that is, the person, company, or organization that provides information about you to a consumer reporting company) are responsible for correcting inaccurate or incomplete information in your report. To take advantage of all your rights under this law, contact the consumer reporting company and the information provider.

STEP ONE

Tell the consumer reporting company, in writing, what information you think is inaccurate. Include copies (NOT originals) of documents that support your position. In addition to providing your complete name and address, your letter should clearly identify each item in your report you dispute, state the facts and explain why you dispute the information, and request that it be removed or corrected. You may want to enclose a copy of your report with the items in question circled. Send your letter by certified mail, “return receipt requested,” so you can document what the consumer reporting company received. Keep copies of your dispute letter and enclosures.

Consumer reporting companies must investigate the items in question — usually within 30 days — unless they consider your dispute frivolous. They also must forward all the relevant data you provide about the inaccuracy to the organization that provided the information. After the information provider receives notice of a dispute from the consumer reporting company, it must investigate, review the relevant information, and report the results back to the consumer reporting company. If the information provider finds the disputed information is inaccurate, it must notify all three nationwide consumer reporting companies so they can correct the information in your file.

When the investigation is complete, the consumer reporting company must give you the results in writing and a free copy of your report if the dispute results in a change. If an item is changed or deleted, the consumer reporting company cannot put the disputed information back in your file unless the information provider verifies that it is accurate and complete. The consumer reportincompany also must send you written notice that includes the name, address, and phone number of the information provider. If you request, the consumer reporting company must send notices of any correction to anyone who received your report in the past six months. You can have a corrected copy of your report sent to anyone who received a copy during the past two years for employment purposes.

If an investigation doesn’t resolve your dispute with the consumer reporting company, you can ask that a statement of the dispute be included in your file and in future reports. You also can ask the consumer reporting company to provide your statement to anyone who received a copy of your report in the recent past. You can expect to pay a fee for this service.

STEP TWO

Tell the creditor or other information provider, in writing, that you dispute an item. Be sure to include copies (NOT originals) of documents that support your position. Many providers specify an address for disputes. If the provider reports the item to a consumer reporting company, it must include a notice of your dispute. And if you are correct – that is, if the information is found to be inaccurate – the information provider may not report it again.

For more information, see How to Dispute Credit Report Errors at ftc.gov/bcp/conline/edcams/credit/ .

Reporting Accurate Negative Information

When negative information in your report is accurate, only the passage of time can assure its removal. A consumer reporting company can report most accurate negative information for seven years and bankruptcy information for 10 years. Information about an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. There is no time limit on reporting: information about criminal convictions; information reported in response to your application for a job that pays more than $75,000 a year; and information reported because you’ve applied for more than $150,000 worth of credit or life insurance. There is a standard method for calculating the seven-year reporting period. Generally, the period runs from the date that the event took place.

For more information, see Building a Better Credit Report at ftc.gov/bcp/conline/edcams/credit/ .

The Credit Repair Organizations Act

By law, credit repair organizations must give you a copy of the “Consumer Credit File Rights Under State and Federal Law” before you sign a contract. They also must give you a written contract that spells out your rights and obligations. Read these documents before you sign anything. The law contains specific protections for you. For example, a credit repair company cannot:

• make false claims about their services
• charge you until they have completed the promised services
• perform any services until they have your signature on a written contract and have completed a three-day waiting period. During this time, you can cancel the contract without paying any fees

Your contract must specify:

• the payment terms for services, including their total cost
• a detailed description of the services to be performed
• how long it will take to achieve the results
• any guarantees they offer
• the company’s name and business address

Have You Been Victimized?

Many states have laws regulating credit repair companies. State law enforcement officials may be helpful if you’ve lost money to credit repair scams.

If you’ve had a problem with a credit repair company, don’t be embarrassed to report it. While you may fear that contacting the government will only make your problems worse, remember that laws are in place to protect you. Contact your local consumer affairs office or your state Attorney General (AGs). Many AGs have toll-free consumer hotlines. Check the Blue Pages of your telephone directory for the phone number or check www.naag.org for a list of state Attorneys General.

The information to repair your credit is available at NO CHARGE!

Springboard is hosting a FREE credit repair workshop at its offices on November 12th or 13th, at 7 PM CST. Be sure to register by calling 1-888-RE-COACH. The program will be approximately 45 minutes in length and available online. You can also register by going to www.springboardonline.com . We will give you the tools you need to repair your credit for FREE.

Need Help? Don’t Despair

Just because you have a poor credit report doesn’t mean you won’t be able to get credit. Creditors set their own credit-granting standards and not all of them look at your credit history the same way. Some may look only at more recent years to evaluate you for credit, and they may grant credit if your bill-paying history has improved. It may be worthwhile to contact creditors informally to discuss their credit standards.

If you’re not disciplined enough to create a workable budget and stick to it, work out a repayment plan with your creditors, or keep track of mounting bills, consider contacting a credit counseling organization. Many credit counseling organizations are nonprofit and work with you to solve your financial problems. But not all are reputable. For example, just because an organization says it’s “nonprofit,” there’s no guarantee that its services are free, affordable, or even legitimate. In fact, some credit counseling organizations charge high fees, or hide their fees by pressuring consumers to make “voluntary” contributions that only cause more debt.

Most credit counselors offer services through local offices, the Internet, or on the telephone. If possible, find an organization that offers in-person counseling. Many universities, military bases, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling programs. Your financial institution, local consumer protection agency, and friends and family also may be good sources of information and referrals. No matter what your situation is, you will benefit by registering for our FREE credit repair workshop on November 12th or 13th at 7 PM CST. Be sure to register by calling 1-888-RE-COACH. The program will be approximately 30 minutes in length and available online. You can also register by going to www.springboardonline.com . We will give you the tools you need to repair your credit for FREE. Coaching assistance will be made available at a later date for a nominal fee.

If you are considering filing for bankruptcy, you should know about one major change to the bankruptcy laws: As of October 17, 2005, you must get credit counseling from a government-approved organization within six months before you file for bankruptcy relief. You can find a state-by-state list of government-approved organizations at www.usdoj.gov/ust. That is the website of the U.S. Trustee Program, the organization within the U.S. Department of Justice that supervises bankruptcy cases and trustees.

Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and debt management, and budgeting. Counselors discuss your entire financial situation with you, and help you develop a personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow-up sessions.
For more information, see Knee Deep in Debt and Fiscal Fitness: Choosing a Credit Counselor at ftc.gov/bcp/conline/edcams/credit/ .

Do-It-Yourself Check-Up

Even if you don’t have a poor credit history, some financial advisors and consumer advocates suggest you review your credit report periodically

• because the information it contains affects whether you can get a loan or insurance — and how much you will have to pay for it.
• to make sure the information is accurate, complete, and up-to-date before you apply for a loan for a major purchase like a house or car, buy insurance, or apply for a job.
• to help guard against identity theft. That’s when someone uses your personal information — like your name, your Social Security number, or your credit card number — to commit fraud. Identity thieves may use your information to open a new credit card account in your name. Then, when they don’t pay the bills, the delinquent account is reported on your credit report. Inaccurate information like that could affect your ability to get credit, insurance, or even a job.

Sample Dispute Letter

Date
Your Name
Your Address
Your City, State, Zip Code

Complaint Department
Name of Company
Address
City, State, Zip Code

Dear Sir or Madam:

I am writing to dispute the following information in my file. The items I dispute also are encircled on the attached copy of the report I received.

This item (identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.) is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be deleted (or request another specific change) to correct the information.

Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please investigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.

Sincerely,
Your name

Enclosures: (List what you are enclosing)

The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

Register for our FREE credit repair workshop on Nov. 12th or 13th at 7 PM CST. Be sure to register by calling 1-888-RE-COACH. The program will be approximately 30 minutes in length and available online. You can also register by going to www.springboardonline.com . We will give you the tools you need to repair your credit for FREE. Coaching assistance will be made available (At a later date) for a nominal fee at this workshop.

For those of you who missed the event, here is your chance to view the replay and get involved.  The GoZone incentives are quickly being snatched up by savvy real estate investors.  Springboard members, guests and friends recently purchased over $6 Million in homes this past week.

Our law firm has a short window of opportunity that GUARANTEES the $40,000 MDA incentive.  This incentive comes with a promise from the investor that requires you to hold the property for 5 years or longer, and fill out a 19-page application.

For those who are new to government paperwork, this could be a stumbling block.  Our law firm has agreed to handle all of this for us, as long as we act quickly.  If you missed last week’s presentation, click here for a replay or cut and paste one of the links below.

High speed link

http://www.springboardcorp.com/mediadepartment/sbevents/thegozone_101107_100k.wmv

Low Speed Link

http://www.springboardcorp.com/mediadepartment/sbevents/thegozone_101107_34k.wmv 

Deadline for submitting the package to our law firm is October 16th. Contact us for details at doug@springboardcorp.com or call 1-630-889-9900 for details.

ANNOUNCEMENT:
“The Real Estate Coach”with Doug Crowe, Chicago’s longest running real estate talk show is moving to WLS AM.  The show will be heard Sunday’s at 7 AM on Chicago’s most listened-to talk station beginning Sunday, October 14th.   Chicago’s Big 89 is now WLS 890 AM. In 1989 the 50,000-watt clear-channel radio giant introduced a new format, and now is watched industry wide as a high powered, issue oriented talk radio station.

All shows will continue to be available at www.dougcrowe.com.

As fewer houses sell, the market becomes crowded

By Anna Marie Kukec
akukec@dailyherald.com
Posted Tuesday, June 26, 2007

The highest number of existing homes in two years are sitting on the market in the suburbs — and they’re facing the lowest percentage of sales in recent times, according to figures released by local Realtors.

Existing, single family homes for sale in Arlington Heights, Mount Prospect and Palatine in May, for example, are at their highest level in recent years. May is the traditional start of the selling season. Together, the three communities had 2,126 homes for sale, nearly twice as many as compared to 1,120 in May 2005.

While the number of homes on the market ballooned, the number sold dropped. In May, the percentage of homes sold in those three towns was 7.5 percent, compared to about 13 percent in May 2006 and 22 percent in May 2005.

This spiraling scenario is hauntingly similar in Libertyville, Vernon Hills and Mundelein in Lake County; Naperville, Bloomingdale and Addison in DuPage County; and Elgin, Cary and St. Charles in the Fox Valley.

In many cases, the more homes that were on the market, the fewer were sold, according to numbers obtained through the Broker Metrics database and Stark & Co. The database includes all existing attached and detached homes for sale in the Multiple Listing Service, across all real estate firms.

Potential home buyer Julie Lipovitch, left, points to a house she is looking at in Mount Prospect with real estate agent Alicia Fedro. The number of homes for sale in the suburbs has increased over the last two years.(Mark Welsh/Daily Herald)

“This is the most challenging market I’ve ever seen,” said Connie Hofherr, Starck vice president and broker manager in Mount Prospect. She’s been selling here for about 30 years.

The suburban market here is weaker that what is happening statewide. From January through May, 56,775 homes sold in Illinois, compared to 66,575 homes sold during the same period in 2006, a 14.7 percent drop, according to figures released Monday by the Illinois Association of Realtors.

Veteran Realtors agreed the suburban real estate market has been one of the toughest, and the most unusual, of their careers. It’s unusual because the market has changed both in reality and virtual reality, they said.

Despite relatively low mortgage rates, several negatives have caused a depression in the suburban housing market, which reflects similar problems nationwide. Creeping inflation, a slow economy, layoffs from major local employers, subprime lenders going belly-up, and a high number of foreclosures and bankruptcies all have taken their toll.

Another factor relatively new and growing in popularity for the real estate market is the Internet, they said. Home sellers on the Internet are not tracked by the Broker Metrics database and the Multiple Listing Service used by Realtors.

More than 70 percent of home buyers searched the Internet first rather than going to a Realtor in 2005, compared to about 2 percent in 1995, according to the National Association of Realtors.

While many Realtors use the Internet to provide more house-hunting features and virtual tours, other Web sites offer home sellers the chance to strike out on their own.

One such Web site, ForSaleByOwner.com, launched in 1999 and has grown in popularity. It fact, the site saw a 60 percent spurt just this past year, said Chief Operating Officer Colby Sambrotto.

“There certainly are more people utilizing our model now than they were a year ago,” Sambrotto said. “But this is not the seller’s market it was a year-and-a-half ago. Sticking a sign outside the house just won’t sell the house anymore.”

ForSaleByOwner.com statistics show about 1,000 listings available for the Chicago market. About 50 percent of sellers here indicated they sold their homes, which took an average of 2¨ months.

It’s not all doom and gloom, said Jim Regan, a Realtor for about 35 years with his own firm, National Sunrise Realty, and more recently with Re/Max in the Northwest suburbs.

“Some people are under the impression you can’t in no way sell a house in this market,” Regan said. “But that just isn’t true.”

Realtors and home sellers just need a good approach and the right niche, regardless of market conditions.

“With the right guidance, you can sell. You can’t just sit and wait for things to happen,” Regan said.

Doug Crowe, director of Lombard-based Springboard Group, a real estate education firm and a broadcaster on real estate investment on WIND 560-AM radio, said both buyers and sellers are like deer in the proverbial headlights.

“Sellers don’t want to cut their prices and buyers are afraid that if they buy something now, it will be the same or less in six months,” Crowe said.

“It’s a lot like a Mexican stand-off,” Crowe said. “People are waiting for something to happen. But when the buyers and the sellers aren’t even flinching, nothing happens.”

Good news for Mariners fans, bad news for Tigers faithful. This week, Standard & Poor’s released its S&P/Case-Shiller U.S. National Home Price Index for April 2007 and the news was just about as bad for homeowners in Detroit as it was good for the folks in Seattle. While the Seattle market zoomed up 9.6 percent between April 2006 and April 2007, the Detroit market plunged 9.3 percent.

The composite index and its regional sub-indices use the repeat sales pricing technique to measure housing markets by collecting data on single-family home re-sales, and capturing re-sold sale prices to form sale pairs. Price appreciation or depreciation is more accurately reflected by the change in value of the same properties over time across entire market areas rather than the more volatile median home prices published by the National Association of Realtors.

Of the 20 markets tracked by the indices, 14 showed price decreases and 6 showed price increases. Charlotte was up a healthy 7 percent and close behind was Portland at 6.4 percent. Other markets like Atlanta and Dallas showed modest increases of 2.1 percent and 2 percent, respectively.

Steep declines were experienced in several previously frothy markets with San Diego down 6.7 percent, Washington, D.C., down 5.7 percent and Tampa down 5 percent. The Composite Index of 20 markets was down 2.1 percent overall.

So where are we headed in the future? Investor expectations are reflected in housing-price futures and options traded on the Chicago Mercantile Exchange, which are based on a subset of the S&P/Case-Shiller U.S. National Home Price Indices. These property derivatives are traded on indices for a 10-market index and the component markets of that composite: Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington, D.C.

Expectations of future price changes are implied by the percentage difference in the index value for the relevant market (most recently published on June 26, 2007, for April 2007 period) and the current price of the four traded futures contracts expiring in August 2007, November 2007, February 2008 or May 2008.

Right now investors are betting on a decline in the composite index of 3.3 percent by the end of the first quarter of 2008 (the futures contract expiring in May 2008 is based on that period). They are most optimistic on the New York area expecting a decline of just 2.3 percent and most pessimistic on Denver with an expected decline of 5.5 percent.

As always, remember that these contracts are new and thinly traded relative to well-established foreign exchange or commodities contracts, and that means they are reflective of the collective wisdom of fewer investors. That said, the market is predicting that price declines in many markets will accelerate over the next year. If only it weren’t so rainy in Seattle!

With more homeowners facing the possibility of foreclosure, the FBI says mortgage fraud schemes are targeting homeowners seeking financial guidance, and exploiting the home-equity-line-of-credit application process.

The FBI’s latest report on mortgage fraud identifies the top 10 states for mortgage fraud as California, Florida, Georgia, Illinois, Indiana, Michigan, New York, Ohio, Texas and Utah.

Mortgage loan originations are expected to fall to $2.28 trillion this year from a high of $3.81 trillion in 2003, which could increase the likelihood that “mortgage fraud perpetrators may take advantage of eager loan originators attempting to generate loans for commission,” the report said.

The FBI cited an estimate by a risk management firm, The Prieston Group, that losses from mortgage fraud schemes perpetrated in 2006 will hit $4.2 billion, not including another $1.2 billion spent on fraud prevention tools.

The most common form of mortgage fraud is illegal property flipping, which often involves false appraisals and other fraudulent loan documents. Because mortgage fraud perpetrators hope to sell their property quickly, “they would likely gravitate towards mortgage loans that offered low and short-term interest rates such as those offered by ARMs (adjustable-rate mortgages),” the report said.

The number of ARM loans containing fraudulent misrepresentations is unknown. The FBI cited an analysis of 3 million loans by BasePoint Analytics, a fraud analytics company that found between 30 percent and 70 percent of early payment defaults (EPDs) are linked to significant misrepresentations in the original loan applications.

The FBI is also alerting lenders about schemes that have emerged during the housing downturn.

Those include foreclosure-rescue fraud scams and schemes involving home-equity-line-of-credit (HELOC) applications.

In foreclosure rescue scams, perpetrators promise homeowners that they can save their homes if they agree to deed transfers and the payment of upfront fees. Such scams often involve forged deeds, and perpetrators may sell the home or secure a second loan without the homeowners’ knowledge, stripping the property’s equity for personal enrichment.

Schemes that exploit the HELOC application process, may involve multiple applications to different lenders for a single property within a short time period. Because property liens may not be recorded for several days or months, lenders may not be aware of other HELOCs taken out against the property. Instead of holding a second lien, lenders may end up with a third, fourth, or fifth lien, and money obtained from the multiple HELOCs may total more than its original purchase price.

HELOC accounts are also being used in check fraud schemes. After securing a HELOC and withdrawing the entire allotted amount, perpetrators use fraudulent checks to pay the balance owed on the HELOC. Before the bank realizes the check is worthless, the perpetrator makes another withdrawal from the HELOC.

A New Jersey couple last year were sentenced to prison and ordered to pay $3.8 million in restitution after being convicted of defrauding Bank of America, Wells Fargo Bank and other major banks in California using such a scheme. Between April 2000 and December 2002, the couple manipulated business and home equity lines of credit extended by the banks to obtain millions of dollars, prosecutors said.

Some lenders have complained that the FBI does not have the resources to adequately investigate suspected cases of mortgage fraud. The Mortgage Bankers Association has requested that Congress set aside $31.25 million over five years to hire more FBI investigators and prosecutors.

An industry-funded group that tracks mortgage fraud, the Mortgage Asset Research Institute (MARI), recently reported a 30 percent increase in suspected mortgage fraud incidents during 2006. The increase was attributed partly to the slowdown in housing markets, which can reveal instances of fraud previously masked by home-price appreciation.

Suspicious activity reports to federal regulators related to mortgage fraud have risen from 3,515 per year in 2000 to more than 28,000 in 2006, which according to the Mortgage Bankers Association, represents losses of about $1 billion. Those numbers likely understate the problem because the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) does not collect reports from lenders regulated at the state level.

The FBI report provides no numbers on the total number suspected cases of mortgage fraud, or of investigations the bureau is conducting. But the report does break down of where FBI investigations are taking place on a regional basis. The FBI said 31 percent of pending mortgage fraud investigations were taking place in the North Central region, 23 percent in the Southeast, 19 percent in the West, 18 percent in the South Central states, and 9 percent in the Northeast.

The report notes that no single regulatory agency is charged with monitoring mortgage fraud, and that combating it “requires the cooperation of law enforcement and industry entities,” including the FBI, the Department of Housing and Urban Development’s Office of Inspector General (HUD-OIG), the IRS, the Postal Inspection Service, and state and local agencies.

The “FBI is proactively working with the mortgage industry in an effort to curb mortgage fraud crimes,” the report said, citing a March 8 memorandum of agreement with the MBA to promote the FBI’s Mortgage Fraud Warning Notice.

The notice states that it is illegal to make false statements about income, assets, debt or matters of identification, or to inflate property value to influence a financial institution’s decisions. The MBA and the FBI are making the notice available to mortgage lenders to use voluntarily to educate consumers and mortgage professionals about the penalties and consequences of mortgage fraud.

SPRINGFIELD, Ill. — May home sales in Illinois rose for the fourth consecutive month in 2007 yet are lower than sales from May 2006. According to the Illinois Association of REALTORS latest report, total home sales (which include single-family and condominiums) were up 10.9 percent in May 2007 to 14,349 homes sold compared to 12,932 homes sold in April 2007. Sales were 18.6 percent below the 17,622 homes sold in May 2006.

The Illinois median home price in May was $205,000, equal to the median price a year earlier. The median is a typical market price where half the homes sold for more, half sold for less.

Year-to-date, sales were down 14.7 percent to 56,775 homes sold January through May 2007 compared to 66,575 homes sold January through May 2006.

“Overall sales are improving each month and we are still seeing positive gains in the median home sale price in many market areas in the state despite the overall housing market adjustment we are experiencing. Illinois REALTORS are reporting homes that are priced correctly and in move-in condition are selling,” said Robert Zoretich, president of the Illinois Association of REALTORS. “We continue to be in a strong buyers’ market with interest rates inching up and inventory levels giving buyers a greater variety of homes. Sellers are gradually becoming more realistic and flexible in the pricing of their properties.”

The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 6.29 percent in May 2007, up 0.06 points from the 6.23 average rate during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in May it averaged 6.70 percent.

The statewide average home price in May was $259,357, up 1.3 percent from $256,066 a year earlier.

In the Chicagoland Primary Metropolitan Statistical Area (PMSA), home sales totaled 9,750 in May 2007, down 20.7 percent from 12,295 home sales in the same month last year.

The median home price for the Chicagoland PMSA was $252,388, up 1.2 percent from $249,500 in May 2006. The average home price for Chicagoland was $317,452, up 2.5 percent from $309,643 in May 2006.

“A basic fundamental driving housing demand is employment and the jobs picture has been improving in Illinois over the last few months,” said Zoretich, broker-owner of Zoretich Realty Group in Chicago. “Economists from the National Association of REALTORS anticipate sales activity to improve by the end of the year while home sales should remain about even.”

Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR local boards and associations. The Chicagoland PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.

The Illinois Association of REALTORS is a voluntary trade association whose over 60,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.

NEW ORLEANS (AP) — Allstate Insurance settled a post-trial legal dispute with a policyholder who was awarded more than $2.8 million by a federal jury over Hurricane Katrina damage, a company spokesman and a lawyer for the homeowner said Thursday.

Terms of the agreement between Allstate and policyholder Robert Weiss weren’t disclosed.

“There’s really nothing left to be done in the case except finalize the settlement,” said Richard Trahant, a lawyer for Weiss.

On April 16, jurors sided with Weiss and decided that the Northbrook, Ill.-based insurer didn’t pay him enough money to cover wind damage to his Slidell home. Allstate blamed most of the damage on Katrina’s storm surge, which wasn’t covered by its homeowner policies.

After the trial, the company asked U.S. District Court Judge Sarah Vance to order a new trial or reduce the jury’s “irrational verdict.”

The verdict was the first among the hundreds of lawsuits that Louisiana policyholders filed against their insurers in federal court in Katrina’s aftermath.

“The jury’s verdict in this case is clearly the product of passion and prejudice and is not supported by the evidence,” Allstate attorney Judy Barrassso wrote, adding that the jury’s award exceeded the limits of Weiss’ policy.

Weiss’ attorneys said the evidence supported the verdict.

Vance, who presided over the trial, hadn’t ruled on Allstate’s post-trial motions before the two sides reached their undisclosed agreement.

The jury concluded that Allstate owed Weiss $561,600 for wind damage to his home and its contents, plus another $2.25 million in damages and penalties for not paying the claim quickly enough following the Aug. 29, 2005, storm.

Weiss had a federal flood insurance policy that paid for some of the damage to his home. He also had an Allstate homeowner policy with limits of $343,000 for the dwelling and $240,100 for personal property. Allstate Insurance Co. already had paid him $29,483 for structural damage and $14,787 for additional living expenses.

If you’re looking for a way to reduce your utility bills and do something good for the environment at the same time, it’s worth taking a good look at your home’s plumbing fixtures. Older fixtures can waste a lot more water than you may realize, and a few simple changes can often make a significant difference.

TOILETS

The toilet can be one of the largest water users in your home. While toilets manufactured after 1994 are mandated by law to use 1.6 gallons of water per flush, most toilets manufactured between about 1980 and 1993 use 3.5 gallons, and pre-1980 models can use as much as 7 gallons of water every time you press that handle down.

One of the most obvious ways to save on water usage is to replace your older toilets with a new one. After some initial problems with the low-flow toilets of the mid-90s, when the reduced-water flush got a bad rap from not handling its waste disposal chores very well, manufacturers made significant design changes that greatly improved the operation of most toilets sold today.

In Europe, most new toilets feature a dual-flush technology that is really quite efficient. The toilet has two flushing buttons on the top of the tank: one button activates a 0.8-gallon flush for the removal of liquid waste, and the other activates a 1.6 gallon flush for solid waste. At least one manufacturer, Caroma USA (www.caromausa.com), offers these well-designed toilets for sale in the United States.

If you have an older toilet that’s in good working order but is wasting water with every flush, consider retrofitting it to use less water. One way to do that is with the Controllable Flush (www.controllableflush.com), which fits most toilet tanks and mimics the action of the dual-flushing European toilet. The no-tool installation is quite simple, and involves the removal of the old flush handle and lever arm and replacing it with the new components contained in the Controllable Flush kit. Pressing down on the handle and holding it for a few seconds allows a reduced flush of about 1.5 gallons, suitable for the disposal of liquid waste, while pressing the handle up raises the flapper valve up in the conventional manner, allowing for a full flush.

Toilet dams, available from many plumbing supply retailers, reduce the interior dimensions of the toilet tank so it holds — and therefore uses — less water with each flush. The typical toilet dam can save a gallon or more of water with each flush. The low-tech method of inserting a brick in the toilet tank, which causes the tank to displace less water, is not recommended — the brick can deteriorate and damage both the toilet and the plumbing lines.

You also want to be sure and check your toilet for leaks. If you hear your toilet running when not in use, you can check for leaks by simply putting a few drops of food coloring in the tank. Check it after about 10 minutes, without flushing, and if any of the food coloring has appeared in the bowl, you have a leak that should be fixed as soon as possible.

FAUCETS AND SHOWERS

Retrofitting your kitchen and bathroom faucets with an aerator is a great way to save water. Aerators introduce air into the water stream, which allows for good pressure with reduced water usage. Aerators are available for just about any type of faucet with internal or external threads, and simply requires screwing the aerator in place.

Aerators are marked with their water flow in gallons per minute (GPM). An aerator with a flow rating of 2.75 GPM or lower is typically considered low-flow, which will save both water and the energy required to heat it. It is estimated that a low-flow kitchen faucet aerator can save about 3 gallons of water per day in the average household, and a bathroom faucet aerator can save 2 gallons or more.

Replacing your old showerhead can be a real water saver as well. Here again, low-flow showerheads utilize air mixed with the water to improve pressure while reducing water usage, and still results in a shower spray that is invigoratingly strong. Look for a showerhead that uses 2.5 GPM or less, which are available in a wide variety of styles, including ones with pulsating massage action.

And finally, fix that that drip! In addition to being noisy and incredibly annoying, a small faucet drip that totals only two tablespoons a minute wastes about 15 gallons of water a day.

Remodeling and repair questions? E-mail Paul at paul2887@hughes.net.