The Housing Bubble - Act 1

Like all speculative bubbles, fraud appears have been a bigger part of the housing boom than any casual observer imagined. The Washington Post reports on that sham mortgages appear to have been an epidemic in recent year, particularly in the high-end market. One frightening statistic cited: Mortgage fraud is up 10-fold since 2000. “Many experts have concluded that the nation's real estate boom of recent years was fueled in part by weakened lending standards that sparked excessive demand and drove up prices. Now, some are worried that the looser standards may have permitted a boom of another kind -- a big expansion of mortgage fraud… As more of these cases come to light around the nation, the question is: How much did an epidemic of fraud contribute to the frenzied housing market of recent years?”