Home / Daily Dose / Fraud Risk Down Due to More Refinance Volume
Print This Post Print This Post

Fraud Risk Down Due to More Refinance Volume

The CoreLogic Quarterly Mortgage Fraud Brief is a quarterly report that analyzes the top metropolitan areas with the highest mortgage fraud risk based on the company’s research of trends found in residential mortgage loan applications processed through its LoanSafe Fraud Manager. 

According to the report, authored by Bridget Berg, Principal of Industry Solutions and Property Intelligence, a small drop in interest rates was enough to push jumbo refinance volumes to spike in Q3, and overall volumes increased slightly for both refis and purchases. In Q3, purchases were 45.7% of transactions, similar to the second quarter at 46.3%. The small shift to refinances and overall volume increase likely caused the 4.6% national index drop. 

As a whole, mortgage fraud decreased due to an increase in refis, which are seen as a lower-risk vehicle for fraud. 

The most likely place one would encounter mortgage fraud in the U.S. was in the Las Vegas-Henderson-Paradise, Nevada metropolitan area (population 2.3 million), where the fraud benchmark was at 232 in the third quarter, down from 250 in the second quarter or a 7% drop. 

The benchmark for fraud was set at 100 by CoreLogic in 2010. 

Two outliers in the dataset were the areas of McAllen-Edinburg-Mission, Texas (population 875,200) and New Orleans-Metairie, Louisiana (population 1.27 million) which each saw a 17% increase in mortgage fraud risk over the last quarter. 

While the report did not indicate which type of mortgage fraud was most common, it took many different forms of fraud into account. 

“There are several different types of fraud that can impact a mortgage,” the report said. “From occupancy fraud, employment and income fraud to property fraud, external factors can drive what types are fraud are more prevalent than others. Our latest fraud brief highlights key industry trends that are driving specific types of fraud, so you can be aware of what to watch out for.” 

About Author: Kyle G. Horst

Kyle G. Horst is a reporter for DS News and MReport. A graduate of the University of Texas at Tyler, he has worked for a number of daily, weekly, and monthly publications in South Dakota and Texas. With more than 10 years of experience in community journalism, he has won a number of state, national, and international awards for his writing and photography including best newspaper design by the Associated Press Managing Editors Group and the international iPhone photographer of the year by the iPhone Photography Awards. He most recently worked as editor of Community Impact Newspaper covering a number of Dallas-Ft. Worth communities on a hyperlocal level. Contact Kyle G. at [email protected].
x

Check Also

Federal Reserve Holds Rates Steady Moving Into the New Year

The Federal Reserve’s Federal Open Market Committee again chose that no action is better than changing rates as the economy begins to stabilize.