Skip to main content

ABC opens 25th branch

National Mortgage Professional
Jan 24, 2006

A need for quality controlRon Littquality control, Far West Credit Inc., In light of the recent findings and fines charged by the Federal Trade Commission (FTC) concerning the credit reporting company Far West Credit Inc. not following reasonable procedures to assure the accuracy of the information on consumer reports, credit reporting companies, lenders and brokers need to be on alert. Why? Mortgage fraud is running rampant. It's everywhere in the industry. It's not only the borrower getting the raw end of the deal either. Ninety percent of mortgage fraud is due to an insider - someone in the mortgage business - be it a broker or even a lender. Lenders, brokers and borrowers need protection for their business and themselves, but what's being done to provide it? Will this continue to happen? Fortunately, more and more mortgage fraud cases are being caught. Unfortunately, most are after the fact. In a recent case, Far West Credit Inc. accepted incorrect information from interested parties to show the consumer's credit status with businesses such as cable companies, utilities and insurance companies and added it to the consumer's credit report. The information Far West received was incorrect and not adequately verified, resulting in charges from the FTC. The key to preventing mortgage fraud lies in quality control. If Far West had a checks and balances system in place, the company would not have to pay the settled FTC charges. Anyone, including your co-workers, can create fraudulent credit reports that can pass for the genuine thing if there are no operations procedures, record keeping or requirements to assure maximum accuracy. A quality control and assurance department is absolutely necessary for this very reason. In an industry that is trying to find better ways of funding underserved or unbanked markets, news like this puts a strain on support for progressive credit alternatives. A lack of quality control damages the potential growth and interest in new products and services for the underserved, and it costs the industry millions of dollars in new revenue and losses because of fraudulent loans. Payment Reporting Builds Credit (PRBC) recognizes this and is the first-ever credit bureau to provide the industry with a tool to help fund the unbanked markets. PRBC demonstrates the creditworthiness of rental and other bill payments while providing verification partners to review and ensure that all information is correct. "PRBC allows only the consumer to provide payment information and assures the reliability and quality of historical data that is provided by utilizing Fair Credit Reporting Act-certified specialists from verification partners such as Advantage Credit," said Matthew Vitko, PRBC director of business development. "These specialists verify Social Security number, current address, historical lease, mortgage, utility, phone, cable and other recurring bill payments, along with judgments and collection accounts. PRBC's procedures for historical verifications meet and exceed the requirements of the FTC, HUD, FHA, VA, Fannie Mae, Freddie Mac and secondary markets for both consumer and business credit." With mortgage fraud on the rise, it is reassuring to know that industry leaders are setting a standard of enforcing quality control measures. Brokers and lenders need to take quality control seriously and not on the back end of the process, when it is too late. If everyone, including reporting companies, brokers and lenders, takes proactive steps, I believe that we will see a decline in this criminal act of mortgage fraud. Ron Litt is president of Pensacola, Fla.-based Advantage Credit International and an industry veteran with more than 41 years experience in the information and mortgage industry. He can be reached at (800) 600-2510 or e-mail at rlitt@advantagecredit.com.
Biden Appoints Sandra Thompson As Acting Director Of The FHFA

The White House appointed Sandra L. Thompson as acting director of the Federal Housing Finance Agency (FHFA), effective immediately. Her statement reveals that a permanent director will be confirmed in December.

Regulation and Compliance
Jun 24, 2021
Supreme Court Gives Biden Full Control Over Federal Housing Finance Agency

The U.S. Supreme Court gave President Joe Biden the authority to remove the head of the Federal Housing Finance Agency (FHFA) while dismissing claims from shareholders of Fannie Mae and Freddie Mac.

Industry News
Jun 23, 2021
Ocwen Financial To Acquire Reverse Mortgage Servicing Platform

Ocwen Financial Corporation's wholly-owned subsidiary, PHH Mortgage Corporation will acquire RMS' reverse mortgage servicing platform.

Industry News
Jun 18, 2021
UniteCT Emergency Rental Assistance Succeeds

Thanks to the successful launch of the UniteCT program, emergency rental assistance funds are helping Connecticut residents maintain housing.

Industry News
Jun 17, 2021
Angel Oak Mortgage Announces Initial Public Offering

Angel Oak Mortgage announced its initial public offering of 7,200,000 shares of its common stock at $19 per share.

Industry News
Jun 17, 2021
Mortgage Apps Rebound After Three Consecutive Weeks Of Declines

The Mortgage Bankers Association reported the first increase in mortgage applications after a three consecutive weeks on declines.

Industry News
Jun 17, 2021