Way back in 2007, Alex Steback wrote a blog post about foreclosures in North Minneapolis that set Johnny Northside into motion. As I understand the tale, this is what motivated John Hoff to go to Blogger.com and start a blog of his own.
Hoff went on a bit of a real estate fraud rampage in BtM’s comments, which led to Stenback updating his original post with an interesting nugget that shows how far reaching and damaging white collar crimes like mortgage fraud can be:
Of course, these fraudulent sales distort the market, because they become comparable (albeit inflated) sales for legitimate transactions. Because of the sheer volume of properties involved, it is highly likely that many legit buyers in north paid more than the true market value. This is where mortgage fraud hurts everybody.
How ya like them apples? Credit worthy law abiding citizens of the City of Minneapolis may have overpaid for their homes (and are paying interest on the inflated financing) because they were under the impression that hundreds of recent fraudulent transactions were giving a fair perspective on the value of homes in that part of town.
Is there another level of pain beyond that? Are home owners in North Minneapolis paying more in property taxes due to artificially inflated home values caused by TJ Waconia’s fraudulent transactions?
While the city isn’t exactly flush with revenues these days, it would be rather odd if owners of some of the city’s least valuable properties were carrying a an extra tax burden due to such a high percentage of fraudulent transactions in that part of town.