The number of cases of mortgage fraud reported to a mortgage fraud tracking database increased by 42 percent during the first quarter of 2008 from the same time last year, according to MARI, the Mortgage Asset Research Institute, an industry research company.
The most common type of mortgage fraud cited was “General Application Misrepresentation,” followed by “Income” and “Employment” misrepresentations. Basically this means that people are putting inaccurate information on mortgage applications. One of the keys to fighting mortgage fraud is figuring out who provided the false data – it’s not always the home buyer – in some cases it’s the real estate agent or mortgage broker.
MARI defines general application misrepresentation as including (but not limited to) incorrect name(s) used; occupancy, income, employment, debt and asset misrepresentation; different signatures for the same name; invalid Social Security number(s); incorrect address(es); and incorrect transaction type.
The top 5 states for mortgage fraud in the first quarter of 2008 were:
- (three way tie) Illinois, Maryland and Michigan
The report concludes that mortgage fraud will continue to increase, due in part to the current poor housing market.
The report did not specify how many incidents were reported or tracked to determine the 42 percent.
Published: Aug 26, 2008