More than 100 Fort Wayne house sales deemed 'suspect'

February 27, 2007

In Fort Wayne, more than 100 rental houses in the past two years have been sold at one price and a mortgage taken out at a higher price, a practice that enriches dealmakers but leaves banks and buyers in the lurch, according to an investigation by The Journal Gazette.

Typically, sellers were paid a certain price, but buyers unwittingly took out loans at levels sometimes twice as high as the selling price.

Dealmakers say the practice is legal. But it has sparked federal indictments and lawsuits elsewhere, and buyers contacted by the newspaper said they weren’t aware they had signed a more expensive mortgage.

Washington Mutual Bank has been hit hard. It made 65 of 124 the newspaper deemed “suspect.” Many of the deals were assembled by Jeff Radabaugh, a 37-year-old who has had addresses in Fort Wayne and several other locations.

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