The Yuma Sun reports from Arizona. "Increasingly, people's dream homes of two or three years ago turn into nightmares because of mortgage payments they no longer can afford. 'We used to get one or two (foreclosures) every couple of months,' said Vicki Bardo, 2007 president of the Yuma Association of Realtors. 'For some years, we didn't have any at all.'"

"She noted that these days it's common to find several trustee sales listed in the public notices section of the newspaper on any given day. For example, on Friday, there were 20 listed. 'We're seeing a preponderance of them,' Bardo said. 'They're in every price range. They're new houses and old houses. They're all over the county from San Luis to Wellton and everywhere in between.'"

"For one thing, people may have used online lenders. Another factor was the number of investors in the market who sometimes bought four or five houses, Bardo said. That resulted in a run-up in prices and an artificial demand for houses. Some of them are now deciding to sell and move on because they can't rent their houses."

"And what had been a housing shortage for several years has now become an overabundance, she said. 'We couldn't keep a house on the market a couple of years ago. Now we can't get it off.'"

"This is all having an impact on new home construction as well, Bardo said. If people can't sell their current house, they can't pay for the new house they were having built. That trend is reflected in the number of housing permits issued by the city. In the first two months of this year, the city issued 38 new single-family housing permits, said Randy Crist, city building official. During the same period in 2006, there were 187 permits."

"'It's not that money isn't there to buy a house ... and interest rates are still low. People are simply waiting for the best deal they can get,' Bardo said."

The Arizona Republic. "Big lenders and Wall Street investors are going after Arizona mortgage brokers, appraisers, real estate agents, title firms and home buyers for fraud."

"Dozens of civil lawsuits alleging the gamut of mortgage fraud, from cash-back deals to lying about income on loan documents, have been filed against Valley firms and individuals during the past few months. Fraud experts and regulators say the lawsuits are only the beginning as the fallout from mortgage fraud starts to hit the Valley."

"'Banks are going to force mortgage brokers to buy back bad loans, and mortgage brokers don't have the money so they are going to go under,' said Richard Hagar, a national mortgage and real estate fraud expert. 'This is the beginning of the wave of lawsuits, lost licenses and criminal indictments in Arizona.'"

"Phoenix-based Biltmore Bank is suing Security Title of Arizona and a group of others over a cash-back deal. The suit alleges the group worked together to get Biltmore to fund a $1.3 million loan for a home valued at $800,000 and then pocketed the extra cash. Also named in the suit are Valley appraiser Kittelmann & Associates and Tucson resident Frank Padilla, who was indicted and pleaded guilty last year to fraud and money laundering as part of a $13 million property-flipping scheme."

"A Lehman Brothers investment trust in New York and Aurora Loan Services in Denver are suing the parent company of First National Bank of Arizona over 38 home loans. They say the bank misrepresented the values of properties, and the income, debt and employment of some of the borrowers."

"San Francisco-based Transnational Financial Network is suing Phoenix-based Lending House Financial and a Scottsdale investor who purchased 22 Valley homes within days of each other last spring. Transnational funded loans worth nearly $2 million on seven of the homes but says it wasn't notified the investor was buying multiple properties and his real debt level wasn't disclosed on mortgage documents."

"The investor never made a payment on the houses, which were foreclosed on last year. Most of the homes sold at foreclosure auctions for tens of thousands of dollars less than the mortgages the investor took out on them."

"This wave of mortgage fraud, bad loans and foreclosures is deja vu for Michael Manning. He was an Arizona attorney for the Federal Deposit Insurance Corp., which seized failed lenders due to bad loans in the late 1980s. He was then the Phoenix attorney for the Resolution Trust Corp., which was formed to clean up the savings and loan debacle and dispose of the overvalued properties."

"'This is the tip of the iceberg, but I think regulators got on top of it faster than in the mid-1980s,' Manning said. 'And lenders are now really starting to crack down on their own underwriting.'"

The Greeley Tribune from Colorado. "A year and a half ago, Christina Vazquez and her family were happy when they qualified to own their first home in a new subdivision in southwest Greeley. Even though she only made $25,000 a year, a lender said her family could get her in a new home worth $225,000."

"'I don't know how they approved me, but they did,' Vazquez said. 'When I bought the home they said my payments would go down in a year.'"

"A year after owning the home, the payments never went down and Vazquez was left with no option but to foreclose. Vazquez is among close to 20 other families from the Gateway Lakes development who have either gone into foreclosure or may soon go into foreclosure. All of the families purchased their homes from the same man, Mark Strodtman of JS Real Estate, LLC."

"'I feel they took advantage of me,' Vazquez said. 'Even though I speak English, they still did not explain any of the paperwork to me and just told me where to sign.'"

"As the homeowners began investigating their home sale paperwork and talking with appraisers, the families discovered that many of their homes were sold to them several thousand dollars more than market value. They claim that JS Real Estate bumped up the prices as much as $70,000 more than the market price in some cases."

"Vazquez purchased her home $55,000 more than what similar homes were selling for. 'What they did was wrong, and all I want is justice to be done,' said Guadalupe Moreno, who is struggling to make the payments on her home. 'If I have to tell the whole world, I will.'"

"Librado Herrera works various jobs for about $12,000 a year and was approved for a $230,000 home. He said he was told by Strodtman to say he owned a catering company when the bank called to verify the information on his loan application. Charles Brandt, president of JC Distinguished Finance who worked with Strodtman in selling the homes, declined to comment."

"'I have never seen a Realtor selling a house $40,000 or $50,000 more than the market price,' said David Kiekhaefer, a Greeley broker and home builder who built five houses in the Gateway Lakes subdivision. 'Another scary thing is that many of them (the families) haven't seen their appraisals from when they purchased their homes.'"

"He said he was not able to sell the homes he built in the subdivision and ultimately turned them into rentals. He was always curious, however, how the other homes that were built were sold so quickly and at a higher cost."

"'There are homes on one side of the street selling at $70,000 more than the same house across the street,' Kiekhaefer said. 'There are a lot of freaky things going on, and it just brings up a lot of red flags.'"