As tuition costs rise, keeping college affordable is a challenge. Several young Americans often take jobs to pay their way, or to help their parents food the bill. But some students are losing a lot more in a new scam.
Between paying for room and board, text books and social lives, many college kids are strapped for cash. So when they hear of a way to get easy money, they are all ears. That's exactly what a crooked mortgage broker was banking on.
U.S. Postal Inspector Don Washington says, "He used their good name and credit to obtain these properties."
The student investor was told they didn't have to put up any money, just the use of their credit.
Washington says, "He would put renters in the properties and they could earn the residual income by just by signing on the dotted line."
When they signed the closing documents on these investment properties the broker claimed the rent payments would pay for the bank loan and, "After a while after the home appreciated he would sell the homes and split the profit with them. Sounded like a good idea to these young people."
The problem is he didn't pay the mortgage. The homes went into foreclosure. The scam created a credit nightmare for these college students. Instead of building wealth, they were heading for bankruptcy.
Washington says, "If you have the feeling that you have been scammed, you should check your credit no more than 30 days when something like this has happened."
Anyone can be a victim of mortgage fraud. Inspectors recommend having an attorney look over your paperwork carefully before signing any loan.