Written By: Stacey Sprain, Op-Ed Writer
Mortgage fraud is a growing national trend that continues to negatively affect the industry that so graciously employs us. Some analysts say that fraud is reaching "epidemic-like proportions."
The Prieston Group, a risk management solutions provider that administers an insurance product covering losses due to fraud and misrepresentation, calculated that losses attributed to mortgage fraud will most likely reach $4.2 billion for 2006. This figure does not take into account another estimated $1.2 billion spent on fraud prevention tools. Source: FBIhttp://www.fbi.gov/publications/fraud/mortgage_fraud06.htm
Analysis of available law enforcement and industry resources indicate that the top ten mortgage fraud areas are California, Florida, Georgia, Illinois, Indiana, Michigan, New York, Ohio, Texas, and Utah. Other areas significantly affected by mortgage fraud include Arizona, Colorado, Maryland, Minnesota, Missouri, Nevada, North Carolina, Tennessee, and Virginia. There is a strong correlation between mortgage fraud and loans which result in default and foreclosure. Source: FBIhttp://www.fbi.gov/publications/fraud/mortgage_fraud06.htm
The best defenses against mortgage fraud are education and awareness. Processors who understand definitions of common fraud schemes have a much better chance of recognizing and questioning suspicious circumstances in order to determine if their concerns are validated.
Fraud Blog Education Series
The goal of this multi-part fraud blog series is to educate mortgage processors on the various types of mortgage fraud and on the far-reaching consequences of accomplished mortgage fraud. By the end of this series you will have received the vital tools and information necessary to create your own standing policy in relation to fraud and determine ways you can effectively handle it if you are dealt the misfortune of discovering it in your day-to-day business.
**Tune in tomorrow for part 1 of this multi-part series!
About The Author
Stacey Sprain - As an op-ed writer, Ms. Stacey Sprain is currently a NAMP® Certified Ambassador Loan Processor (NAMP®-CALP). With over 15+ years of mortgage banking experience, Stacey is also a Quality Control Manager for a major mortgage lending institution.