CoreLogic Spots a Reduction in Mortgage Fraud, But…

Roughly $7.4 billion of fraudulent mortgages will be originated this year, a 40% decline from 2011, a decrease primarily due to significantly lower fundings volumes in 2011, according to a new report from CoreLogic.

Based on an analysis of 10.5 million loan applications from the first quarter of 2005 through the first quarter of 2011, CoreLogic’s Mortgage Fraud Trends Report offers a caution about “the ever-changing nature of fraud,” saying that some scams are now more popular than before.

Still, the firm’s CoreLogic Fraud Index has remained relatively flat for the past five quarters. The company attributes the decrease to “lenders’ improved pre-funding fraud controls” that have curbed the fraud growth that spiked in 2007.

One of the new fraud “stars” is property-related scams, which increased 262% compared to last year. Meanwhile, identity fraud decreased 45%, CoreLogic said, attributing the drop to public awareness and more organized efforts to fight it.  

Analysts stressed that while the overall fraud rate “has been relatively flat over the last few quarters,” new fraud schemes are showing up where there are weaknesses and vulnerabilities in lenders’ fraud prevention programs.

In response, CoreLogic said it has designed an Alert Risk Index “to evaluate the movement in individual fraud types and to observe additional risk patterns.”

Daily Briefing | Thursday, September 29, 2011

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    It appears that rock bottom mortgage rates have yet to cure the housing industry’s woes.

  • OCC Offers Sobering News on Foreclosures

    Nine major servicers regulated by the Office of the Comptroller of the Currency completed 180,000 foreclosure actions in the second quarter, but these firms are still managing roughly 1.3 million borrowers who are going through the foreclosure process.

  • B of A Top Warehouse Lender in 2Q, But Unit’s Future in Doubt

    Bank of America ranked first among all warehouse providers in the second quarter with $12 billion of funding commitments, a 20% decline from a year ago, according to new figures compiled by National Mortgage News.

  • Idaho Bank to Outsource Origination Function

    Home Federal Bancorp, Nampa, Idaho, as part of a major restructuring, will outsource its residential origination function to a third-party vendor.

  • Fed President Wants GSEs to Step Up on Refis

    Boston Federal Reserve Bank president Eric Rosengren wants Fannie Mae and Freddie Mac to do more to refinance homeowners and address housing market problems.

  • European Banks to Sell Troubled CRE Loans

    Banks in Europe will try to unload roughly 15 billion euros ($20 billion) of loans secured by commercial real estate in Europe through 2012 as they comply with tighter capital regulations, according to Situs Companies, a debt advisor.

  • Cascade Bancorp of Oregon Selling Problem Loans

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  • Mortgage Stanley’s Mantz Joins Rialto

    The executive who helped build one of the world’s leading real estate investment platforms at Morgan Stanley has landed in Miami, where he will oversee one of the country’s largest home builder’s workout business.

  • NCUA Failed to Spot CU’s High Concentration of Risky MBS

    A new report issued by the National Credit Union Administration blames the agency’s Office of Corporate Credit Unions for failing to identify a high concentration of risky MBS at the now defunct Southwest Corporate Credit Union of Texas, a $12 billion institution.

Article source: http://www.nationalmortgagenews.com/dailybriefing/2010_442/reduction-mortgage-fraud-1026756-1.html

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