The level of mortgage fraud in the United States has increased since last year, with sales of foreclosed homes the most likely target, according to a report released by CoreLogic.
Mortgage fraud cases peaked at 109 in 2006, and fell to 68 in early 2009. However, it rose by over 20 percent to 82 cases in the second quarter of this year, said CoreLogic.
The housing and financial data firm had analysed 7 million home loans issued from Q1 2005 through Q2 2010. It said the increase comes as borrowers shifted toward higher-risk, high volume home loan programmes, and foreclosed resales have become more common in a crumbled mortgage market.
“Fraud continues to shift to areas of the lending business where large volume increases occur over short periods of time, or where advanced risk mitigation processes are not squarely in place,” said Tim Grace, senior vice president at CoreLogic.
The firm added that fraud risks linked with refinancing has jumped 30 percent since early last year, while one in every 24 foreclosed home sales was associated with a fraudulent transaction.