Knowing what mortgage fraud is and how to prevent it can protect your clients and real estate business from devastating financial harm.
Knowing what mortgage fraud is and how to prevent it can protect your clients and real estate business from devastating financial harm.
Tyler Adams
5 minutes
Fraud Prevention
May 24, 2022
As an expert in the real estate industry, you know the importance of keeping all the moving parts and documents involved in the closing process organized and on track.
However, multiply that stress, effort, and coordination by the size of your portfolio, and a delicate balance can be harder to achieve, making it easier for mistakes to be made and key points to be overlooked.
Unfortunately, criminals are increasingly taking advantage of these processes to facilitate mortgage fraud and make financial gains.
Mortgage fraud can cause devastating financial and reputational damage to your company and your clients, so real estate professionals should know how to identify it and stop it in its tracks.
Here is an overview of what mortgage fraud is and how to identify and stop it before it spirals:
Although it can take many forms, mortgage fraud typically involves a person intentionally making materially false statements to obtain a mortgage loan or ownership of a property.
According to the FBI, there are two distinct types of mortgage fraud:
This second form of mortgage fraud, fraud for profit, can be further broken down into two different types:
Mortgage payoff fraud is another unique form of fraud for profit. This involves criminals impersonating a lender or a title company to reroute funds sent from a party to the sale from the disbursement after the settlement process.
Mortgage payoffs are such important transactions, so how do criminals pull off fraud?
Here are the common methods:
Criminals are always on the lookout for businesses that make it easy to initiate and pursue their scams. Fortunately, with the right tools and security practices, these criminals can be thwarted.
Here are some ways to prevent mortgage fraud:
Although there is no way to guarantee mortgage fraud will never happen, implementing these security practices can help protect your and your customer’s assets.
Although the real estate market is always in flux, the security, privacy, and reliability you provide to your customers will be consistently strong with CertifID as part of your organization’s security practices.
Want to learn more about how to spot and prevent mortgage payoff fraud and how CertifID’s platform can provide the end-to-end encryption your customers deserve?
Then we welcome you to check out our e-book, Mortgage Payoffs Under Siege.
Co-founder & CEO
Tyler brings a decade of leadership experience developing and launching technology businesses. Before co-founding CertifID, Tyler led new product development at BCG Digital Ventures for Mercedes-Benz, First American Financial, Boston Scientific, and Aflac.