Mortgage fraud saw continued elevated levels in 2010, sustained from 2009, says the latest FBI report on mortgage fraud. Reverse mortgages are included among the prevalent mortgage fraud schemes reported, with Fannie Mae reporting that current reverse mortgage fraud schemes include the use of asset misrepresentation, occupancy fraud, and identity theft.
“Mortgage fraud schemes are particularly resilient, and they readily adapt to economic changes and modifications in lending practices,” the report states.
While total dollar losses due to mortgage fraud are unknown, perpetrators include licensed/registered and non-licensed/registered mortgage brokers, lenders, appraisers, underwriters, accountants, real estate agents, settlement attorneys, land developers, investors, builders, bank account representatives, and trust account representatives, according to the FBI.
Because of the heightened levels of mortgage fraud, the FBI has continued to dedicate significant resources to the threat, it says. Additionally, “The current and continuing depressed housing market will likely remain an attractive environment for mortgage fraud perpetrators who will continue to seek new methods to circumvent loopholes and gaps in the mortgage lending market. These methods will likely remain effective in the near term, as the housing market is anticipated to remain stagnant through 2011.”
The areas most targeted by mortgage fraud are California, Florida, New York, Illinois, Nevada, Arizona, Michigan, Texas, Georgia, Maryland, and New Jersey, and the same regions were most often targeted in 2009.
View the report.
Written by Elizabeth Ecker