CoreLogic: Mortgage Fraud Risk Up in Q2

The risk of mortgage fraud in the second quarter was 12.4 percent higher from one year earlier, according to the latest data from the CoreLogic Mortgage Application Fraud Risk Index.

 

CoreLogic determined that an estimated one in 109 applications, or 0.92 percent of all mortgage applications, contained indications of fraud in the second quarter. One year ago, that level was one in 122, or 0.82 percent of all mortgage applications. The conforming loans for home purchases segment ran the greatest risk increase by loan type, while income fraud risk had the greatest annualized increase; property and undisclosed real estate debt showed declines in risk from one year ago. For the second consecutive year, New York, New Jersey and Florida were the top three states for mortgage application fraud risk during the second quarter.

 

“This year’s trend continues to show an increase in mortgage fraud risk year over year,” said Bridget Berg, Principal of Fraud Solutions Strategy for CoreLogic. “Because home prices are rising, and demand is strong, most mortgage fraud in this type of market is motivated by bona fide borrowers trying to qualify for a mortgage. Undisclosed real estate liabilities, credit repair, questionable downpayment sources and income falsification are the most likely misrepresentations.”

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