The Miami Herald reports from Florida. "Seven new suspects accused of mortgage fraud were rounded up by police, as Miami-Dade County Mayor Carlos Alvarez unveiled new legislation to increase criminal penalties for people convicted of real estate fraud. The proposal would allow property appraisers to revalue assessments in neighborhoods plagued with fraud, where inflated values have driven up property taxes for nearby homeowners. It would also create a statewide mortgage fraud task force."

"'A lot of people think...[mortgage fraud] is just a way of making money, that it's a business, it's an industry. But they are going to find out very differently,' Alvarez said at a news conference. 'If you've done it, you might be in trouble.'"

"None of those arrested had prior records. Police said they were seeking to arrest the appraiser who appears to have overvalued the home, which fraudulently sold for $1.8 million."

"'I would venture to say in talking to some of these folks that they probably don't even think they have committed a crime. It's a business transaction: You use my credit, you give me money, and we're all happy,' Alvarez said. 'The fact of the matter is that's fraud. Being a straw buyer is a fraud. Inflating property values is a fraud. Creating documentation is a fraud just to obtain a mortgage.'"

The Daily Business Review from Florida. "'If we’re No. 1 in fraud in the U.S., then there’s a problem with overvaluation of properties,' said task force chairman Glenn Theobald, legal counsel to the Miami-Dade Police Department. 'Everyone’s taxes have gone up because of these knuckleheads doing fraud.'"

"A condo building known to have 30 to 40 percent of its units involved in phony deals, which almost always involves inflating values to get more money back for the fraudsters, could be carved out of tax rolls."

"'Everyone’s just values will be what they should be, and they will pay less taxes,' Theobald said."

"Miami-Dade’s proposal is one county property appraisers statewide should already be doing, said Frank Gregoire, a Tampa appraiser and chairman of the Florida Real Estate Appraisal Board."

"'Sales that are falsely inflated should not be considered in the market-value approach to appraisals because they aren’t a measure of an informed buyer and seller dealing at arm’s length,' he said."

"In Pinellas County, numerous sales have been removed from the county’s appraisal strategy, he said."

"In Miami-Dade County, 20,475 foreclosures have been filed -- roughly one of every 32 homes. That's up from 9,814 foreclosures filed in all of 2006, according to court data."

"In Broward County, 20,812 foreclosures have been filed, that's about one of every 30 homes."

"'There are too many foreclosures, but it's reality,' said attorney Stuart Gitlitz, who has filed foreclosures on behalf of lenders for more than 20 years. 'It's all these loans that were refinanced during the last six years or so as interest rates came down, and stayed down.'"

"Aside from mortgage fraud, Gitlitz said, adjustable-rate loans 'are the single largest culprit of what is happening here because interest rates really haven't gone up.'"

"For the state, new foreclosures filed in the three months ending Sept. 30 for all types of mortgages rose 49 percent from the previous three months to 1.09 percent, up from .73 percent of all outstanding loans, according to the Mortgage Bankers Association."

"And the number of loans already in the foreclosure process jumped 54 percent from 1.42 percent to 2.19 percent of home loans during the same period."

The Sun Sentinel from Florida. "South Florida won't get a big boost from President Bush's plan to freeze interest rates for homeowners nationwide who are bracing for sharp increases in their adjustable-rate mortgages, analysts say."

"Many distressed borrowers across the region can't benefit because they're investors or homeowners at least 90 days late on their house payments."

"What's more, Bush's proposal is focused on preventing a national foreclosure crisis and not meant to aid individual states, such as Florida and California, that are leading the housing bust after the boom of 2000-2005."

"'It's not going to help areas that need help the most, and Florida certainly is one of those,' said Per Gunnar Bergland, chief economist for Moody's Economy.com."

The Northwest Florida Daily News. "Local circuit courts are struggling to keep up as mortgage foreclosure filings continue to increase. Already, more than 2,000 foreclosures have been filed in Okaloosa, Santa Rosa and Walton counties."

"In Santa Rosa, foreclosures have made up most of the civil cases filed in circuit court this year, said Susan Land, supervisor of Santa Rosa County’s circuit civil division. Her division has had about 1,300 cases filed. Of those, 804 have been foreclosures."

"Okaloosa County has also seen a large increase in foreclosures, going from 466 last year to 892 so far this year, said Danny Luke, courts director for Okaloosa’s Clerk of Courts office."

"Based on the number filings so far, Okaloosa Clerk of the Circuit Court Don Howard estimates that 930 foreclosures will be filed by the end of the year. That would be a 234 percent increase from 2005."

"'That’s substantial to say the least,' Howard said. 'With the increases we’ve seen the last couple of years, it’s put a burden on that department. There’s no doubt about that.'"

The St Petersburg Times from Florida. "An increasing number of homeowners are unable to make payments on homes worth less than they owe. But one man's problem is another's possibility. A new market is forming for those who buy and sell homes about to be taken back by banks."

"The process can be complicated. Banks are more interested in receiving payments than taking a home, but they won't discount a loan for nothing, so there has to be evidence of a problem. And after the fact, there can be tax implications for the homeowner."

"'You have to have a hardship,' said Ken Monduori, who works with Regions Bank and teaches real estate agents the finer points of 'loss mitigation' with banks. Typically the story should be 'the sadder the better' to persuade the lender to accept less than full payment."

"'If you're financially insolvent, there's a hardship, but if not, get in line, pal,' he said. 'There are a lot of slick people. Banks aren't going to play that game.'"

"If there is equity in the home, a buyer may get a deal at the expense of the distraught home-owner. If there's no equity, someone like Mitchell Herman will try to talk the bank down. 'I have no compunction about making money off of banks,' said Herman."

From The State in South Carolina. "S.C. homeowners are falling behind on their mortgages at a greater rate, and more are entering foreclosure than a year ago, according to a report Thursday by the Mortgage Bankers Association."

"About 1.7 percent of South Carolina mortgages were in foreclosure on Sept. 30, up from 1.6 percent a year earlier. The U.S. foreclosure rate was also 1.7 percent, up from 1.1 percent a year ago."

"About 6.5 percent of the state’s mortgage holders were more than 30 days late — but not yet in foreclosure — up from 5.9 percent a year ago."

"Don Schunk, research economist at Coastal Carolina University in Horry County, said the rising delinquency and foreclosure rates reflect loose lending practices of the past few years: offering low teaser rates that adjusted sharply up after a couple years; lending the full price of the house and requiring little or no proof of income."

"'We know there were a lot of loans made that shouldn’t have been made,' Schunk said. 'A lot of the funding to make those types of loans is gone. That’s a good thing.'"

The Journal News in West Virginia. "Homes, lots and raw land that had been foreclosed upon brought in millions of dollars at auction this week, along with warnings that such instances are 'just the tip of the iceberg' that is the current mortgage crisis."

"'You hate to see foreclosures, but it’s a sign of the times right now,' said Darwin Plumlee, of Plumlee Auction Service, which held sales over three days and finished up Thursday afternoon in Berkeley County."

"On Wednesday, $5.2 million worth of property was sold, with the majority coming from the Apple Knolls subdivision off Dry Run Road — a development Plumlee called 'one of the nicer in the county.' On Thursday, raw land prime for the development of additional subdivisions in the southern end of Berkeley County was sold for a total of $2.3 million."

"In his 34 years as an auctioneer, Plumlee said he has never seen so many foreclosures come through the area. He attributed the increase to the subprime loans made to people who bought homes they truly couldn’t afford."

"Residential properties, even in growth areas like the Eastern Panhandle, are suffering in today’s downtrodden market."

"Some of the properties bought at auction, including those in Apple Knolls, were houses that were never even sold. A lot of people need to sell,' Plumlee said. 'It’s the best way right now. It’s working.'"