Federal Prosecutors Accuse Loss Mitigation Services Of Defrauding HUD, Fannie Mae, and Freddie Mac
The owners and co-founders of Loss Mitigation Services are accused of defrauding Fannie Mae, Freddie Mac, and HUD. Federal prosecutors allege the Massachusetts based short sale company defrauded government agencies on nearly 100 short sale transactions.
Loss Mitigation Services negotiates with lenders and mortgage guarantors approval of short sales in lieu of foreclosure.
A short sale occurs when the mortgage debt on the home is greater than the sale price. As a result, the lender or mortgage owner agrees to take a loss on the transaction.
Prosecutors allege company founders Gabriel Tavarez and Jaime Mulvihill collected fees for acting on behalf of underwater homeowners.