Here are 7 common types of mortgage fraud that your business needs to be aware of and how you can reinforce your closing process to stop criminals in their tracks.
Here are 7 common types of mortgage fraud that your business needs to be aware of and how you can reinforce your closing process to stop criminals in their tracks.
Katie Stewart
4 minutes
Mortgage Payoff
Aug 23, 2022
The vast majority of customers your real estate business interacts with are honest, hardworking people looking to start a new chapter of their lives or fulfill a dream of buying a home of their own.
Unfortunately, as in every industry, there are a few bad apples out there set on making a profit off of the home-buying process either on their own or with a group of conspirators who are in on it.
While the rise of digital tools and technology has made the process of buying or selling a home easier, it has also introduced new ways for criminals to commit more types of mortgage fraud than you may know of, leaving real estate professionals and honest customers left to pick up the financial pieces in their wake.
Here are some of the common types of mortgage fraud that your business needs to be aware of and how you can reinforce your closing process to stop criminals in their tracks.
While it can take many forms, mortgage fraud typically involves a person intentionally making materially false statements or positions to obtain a mortgage loan or ownership of a property.
Diving a bit deeper, industry professionals typically consider there to be two primary categories of mortgage fraud:
On their face, some fraud attempts seem easy to spot. However, criminals have become more sophisticated in how they pull off their fraud. In particular, they can use digital tools to:
While not an exhaustive list, here are some of the more common types of mortgage fraud that you and your team need to know so you can be ready to protect your interests and aren’t caught off guard:
Like the common neighborhood criminal looking to take advantage of a victim that fails to lock their car door or leaves a home window open, real estate fraudsters are also looking for easy marks that fail to follow security best practices.
That’s why it's vital for your business to not only follow common cybersecurity best practices but also offer your customers access to a platform such as CertifID that delivers end-to-end encryption when it comes to collecting the data used to facilitate wire transfers.
Want to learn more about real estate fraud and how you can better protect your reputation and your customers? Take a moment to download CertifID’s free whitepaper, Mortgage Payoff Fraud Is Rising; Here's How to Protect Your Business.
VP of Customer Success
Katie's background combines both IT and education. Her degree is in Management Information Systems, and she spent her first four years in the workforce as an IT business analyst. Katie took a career turn and joined Teach for America and worked in inner-city schools in Indianapolis as a math teacher and eventually an assistant principal. Today she combines her IT nerdiness and love of teaching, helping customers find success every day.