It was reported last week that Mortgage Fraud Is On The Rise.  However, I question whether Mortgage Fraud Is Truly On The Rise, or that just more Lenders are reporting Mortgage Fraud.

Earlier this year the Consumer Financial Protection Bureau (CFPB), enacted a new law which mandates that Lenders report any and all suspicious activity that they identify.  Lenders are required to not only report suspicious activity, but they need to put in place a policy by which they will do so, and review it and update it yearly.  As a result of this new law reports of suspicious activity have increase as more and more Lenders put their policies in place, and train their employees on what to look for, and how they are to report it.

So I question the accuracy of reports stating that Mortgage Fraud Is On The Rise.  What I believe is on the rise is the reporting of Mortgage Fraud, which leads to the perception that Mortgage Fraud Is On The Rise.  In fact my opinion is that Mortgage Fraud has been declining in recent years, do to the fact that Lenders are looking for it more and more.

What I found valuable in the report was the categories that Mortgage Fraud is being reported most in.  The three areas that Mortgage Fraud is being reported the most is:

  • Condominiums ranked the highest for identity fraud
  • Employment/income fraud
  • Simgle Family Properties ranked high for property valuation fraud

 I think the fact that Lenders are being more vigilant in reporting suspicious activity is good, but what I am concerned about is whether any action is then taken by the CFPB.  It is all fine and dandy that a better effort is being made to catch those that are committing Mortgage Fraud, but what good is it if these reports just sit on a shelf or on someones desk and nothing is done with them.

In stead of reports stating that Mortgage Fraud Is On The Rise, I want to see reports of an increase in putting those that commit Mortgage Fraud behind bars.

 

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George Souto NMLS# 65149 is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308  gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage

 
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8 Comments on Mortgage Fraud Is On The Rise

AUG
14
252,825 Points 6 Featured Posts Outside Blog

George,

With what we have all recently gone through, it is disappointing that fraud appears to be going up again.  I guess that just goes to show you that there is that segment of the population that will choose the low road.
5:04pm • #1
371,273 Points 10 Featured Posts Outside Blog Called Shot Master

George - it is so disgusting and if we come across anyone who is mis-representing their profession, then I think we should be reporting them..

 
5:07pm • #2
200,105 Points 3 Featured Posts Localism Sponsor Outside Blog Called Shot Master

Well said.  I was in banking for a period of my work life; and, it takes time for new regulations to show improve.ment in reporting
5:10pm • #3
866,303 Points 18 Featured Posts Localism Sponsor Attended Rain Camp Called Shot Master

This is very disappointing to say the least.   I hope thing will be resolved and the bad apples will be dealt with.
8:57pm • #4
AUG
15
878,959 Points 75 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

George no suprise we have seen fraud increase over the last 5 years but I am surprised if it has gone up more recently.
4:17am • #5
494,996 Points 29 Featured Posts Outside Blog Called Shot Master

Unfortunely, it take time to discover all this stuff. I've reading a lot about these cases that took place 4-7 years ago. During that time period, there was apparently a lot of that stuff going on. These cases are not becoming more public.

These prision sentences aren't long enough. Longer terms might have someone think twice, but desperate people do desperate things.
7:09am • #6
796,571 Points 80 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Unless they are putting in jail or levying huge financial penalties, i wonder what real effect it has...hope you make it to Dagny's get together so i can meet you finally...btw, i'm near the end of your blog posts on my web site...if you decide to get going on another series next month it would be great!
9:02am • #7
1,360,336 Points 244 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Kerry, it is disappointing that fraud continues, but I do not thing that it is on the rise, it is that Lenders are reporting it more now than they have in the past because of new regulations.

Gay I agree it needs to be reported but then those reports need to be acted on.

Pat you are right it does take time.

Joan we will never get rid of all the bad apples, but we can try to reduce their number.

Bill like I commented to Kerry, I don't think that it has risen, in fact I think there is less of it, but it is being reported more than it was in the past because of new regulations.

Joe I agree the penalties are not sever enough, and not enforce enough.

Ginny I have not seen Dagny announce a Get Together yet, but if she has one I will make every effort to be there, because I would like to meet you as well.
6:37pm • #8

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George Souto

Middletown, CT

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George Souto NMLS# 65149 FHA, CHFA, VA Mortgages Connecticut

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