IRVINE, Calif.–(BUSINESS WIRE)–CoreLogic®, a leading global provider of property information, analytics and data, has released its latest Mortgage Fraud Report. The report shows a 7.5% year-over-year decrease in fraud risk at the end of the second quarter of 2022, as measured by the CoreLogic Mortgage Application Fraud Risk Index. The decline in mid-2022 follows a sharp increase seen during the same period in 2021 and is partly due to the recalibration of CoreLogic’s rating model in the first quarter of 2022. Since this update, higher risks were recorded during the months of the second quarter, in particular for certain types of mortgage fraud.

In the second quarter of 2022, approximately 0.76% of all mortgage applications contained fraud, or approximately 1 in 131 applications. In comparison, in the second quarter of 2021, this estimate was 0.83%, or approximately 1 in 120 claims. Income and property fraud risks showed the largest year-over-year increases in the second quarter, at 27.3% and 22.6%, respectively. This trend is perhaps unsurprising, given that purchase loans now account for more mortgage transactions than refinances, and the former are more likely to be fraudulent.

“The risk of income fraud remains a major concern for lenders, but there is an increasing focus on property value risk as house prices slow growth and homes take longer to sell. sale. Data from CoreLogic confirms these concerns, as our most predictive metrics for revenue and asset fraud have increased more than 20% over the past year,” said Bridget Berg, Director, Industry & Fraud Solutions.

Report Highlights:

  • Nationally, five of the six types of mortgage fraud tracked by CoreLogic showed increased risks since the second quarter of 2021. The exception was undisclosed real estate debt, which fell 12%.

  • The top five states where the risk of fraud is increasing are Rhode Island, South Dakota, Kentucky, New York, and Nebraska. Less populated states are prone to volatile index values, as small groups of high-risk loans are more likely to move the index. For example, Rhode Island’s 60% increase in fraud risk year-over-year was partly due to a large portion of government-backed loans, which became riskier over the year. elapsed.

  • New York rose to the top spot for mortgage application fraud risk, with Florida, Rhode Island, Nevada and Connecticut rounding out the top five.

National Mortgage Origination Fraud Index (Q3 2010 – Q2 2022)

The CoreLogic Mortgage Fraud Report analyzes the collective level of fraud risk associated with loan applications in the mortgage industry each quarter. CoreLogic Develops Index Based on Residential Mortgage Applications Processed by CoreLogic LoanSafe Fraud Manager, a predictive scoring technology. The report includes detailed data for six fraud type indicators that complement the national index: identity, income, occupation, ownership, transaction and undisclosed real estate debt.

To view the full report on CoreLogic Mortgage Fraud, visit www.corelogic.com/mortgagefraudreport.

Methodology

Our comprehensive fraud risk analysis is based on a lender-led mortgage fraud consortium and state-of-the-art predictive scoring technology.

The CoreLogic Mortgage Application Fraud Risk Index represents the collective level of fraud risk the mortgage industry faces in each period, based on the share of loan applications at high risk of fraud. The index is normalized to a reference value of 100 for the share of subprime loan applications nationwide in the third quarter of 2010.

Fraud type indicators are based on specific CoreLogic LoanSafe Fraud Manager alerts. These alerts are compiled consistently for all members of the CoreLogic Mortgage Fraud Consortium. Indicator levels are based on the prevalence and predictive ability of relevant alerts. An increase in the indicator is correlated with an increased risk of the corresponding type of fraud.

Source: CoreLogic

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About CoreLogic

CoreLogic is a leading global provider of property information, analytics, and data-driven solutions. The company’s combined data from public, contributory and proprietary sources includes more than 4.5 billion records spanning over 50 years, providing detailed coverage of property, mortgages and other encumbrances, consumer credit, location, location, hazard risk and related performance information. The markets CoreLogic serves include real estate and mortgage finance, insurance, capital markets and the public sector. CoreLogic delivers value to customers through unique data, analytics, workflow technology, advisory and managed services. Customers rely on CoreLogic to identify and manage growth opportunities, improve performance and mitigate risk. Based in Irvine, California, CoreLogic operates in North America, Western Europe and Asia-Pacific. For more information, please visit www.corelogic.com.

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