Lender's Beware! Fraud Is On The Rise
Lender's Beware! Once again, fraud is on the rise. One of the great things about SCA is the range of issues we get to see, and the wealth of knowledge we get to tap into while working with dozens of clients on a monthly basis. Today, we'll share a message from our Director of Sales and Business Development, Bill Dolan.
A Message From Bill Dolan:
It was ten years ago this week that the Feds swooped in and arrested Bernie Madoff in one of the largest financial fraud cases in U.S. history. It would eventually come to light that Mr. Madoff had orchestrated the most extensive Ponzi scheme ever, totaling $65 billion.
Maybe not on the same grand scale, but certainly an issue we all need to take notice and keep a watchful eye out for, is the presence of mortgage fraud that is rearing its ugly head in the industry once again.
It’s not enough that home prices have been escalating and rates remain volatile, but in recent audits, SCA, along with Fannie Mae and other large national conduits, have seen a sizeable increase in mortgage fraud. Homebuyers appear to be finding it far tougher to qualify in this current purchase market and are resorting to extremely innovative new strategies, determined to obtain a residential mortgage even if it means misleading you, the lender. More and more loan applicants are taking to the Internet and finding loopholes through websites that help them devise salary and employment records that are totally fictitious. The job is then verified through a simple phone call by a mortgage originator to an “employer” through these online sites.
Still others become even more creative by borrowing their down payments and advising the lender that they received an interest-free gift from an aunt or cousin, documented using a genuine-looking form obtained online as well. One of the leading indicators of mortgage fraud by applicants in the industry today has been falsifying income. So how do you as a lender identify and counter fraud?
SCA, with its QC quantitative analytics and web-based technology, assures loan quality throughout the entire mortgage cycle; leveraging intelligent questionnaires (both pre-set along with user-defined audit questions) that drive the technology’s rules-based platform. This affords our Clients the ability to mitigate undo risk and exposure by reducing risk of defects, legal liability and potential GSE and Agency buybacks or repurchases. SCA can replicate the same level of data-powered intelligence and analytical functionality for you, just as we perform for our own Clients who leverage our expertise and partner with us for the following outsourced services:
Pre-Funding Quality Control
Post Closing Quality Control
Credit Review
Compliance Review
Appraisal Review
Post-Closing Documentation Review
Furthermore, our personalized service and “hands-on” approach are characteristics that we believe have differentiated SCA from our competition for almost 30 years. It doesn’t STOP there. SCA also provides management solutions, technology consulting, compliance, quality control, training and staffing to your organization during this challenging mortgage cycle.
Need someone who will listen to you? Contact us!
Sincerely,
Bill Dolan
Director, Sales and Business Development
Spillane Consulting Associates has served the residential mortgage lending business since 1991. We have specialized in mortgage banking consulting services and provided quality control reviews, risk management and process consulting and employee training to credit unions, community banks and non-depository institutions. We are a thought leader on the strategic growth of residential mortgage lending. You can learn more by visiting our website, or scheduling a meeting with me or one of my colleagues.
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