Mortgage Fraud Rises
TAMPA - In a state that leads the nation in mortgage fraud, Tampa had the second-most cases of suspicious loan activity of any Florida city, according to a report released Tuesday from the Reston, Va.-based Mortgage Asset Research Institute.
Fraud also seems to be a growing problem in Tampa. The group said fraud reports for the area make up 18 percent of the state's volume, up from 4 percent last quarter.
Despite fewer loan applications nationwide, mortgage fraud cases are up 45 percent in the second quarter, compared with the same quarter a year ago, the report said. Of those cases, 21 percent of the loans were for properties in Florida.
Florida has led all other states in reported mortgage fraud for two consecutive quarters. California and Illinois ranked second and third among the states.
It's somewhat surprising that mortgage fraud continues to grow, even though it's more difficult to obtain loans now, said Denise James, a director of ChoicePoint, the parent company of the research institute.
Part of the reason, she said, is because mortgage professionals who took part in fraud during the boom years want to maintain their lifestyles.
"They're going to have to keep that up and really embellish the applications," she said. "We're seeing very basic fraud such as fake pay stubs."
Miami, with 45 percent of the state's fraud reports, had the most problem loans, the report showed.
The most common types of misrepresentation for the Tampa area were associated with appraisals, flip sales and inflated values of more than 30 percent.
Professionals involved in fraudulent transactions in the Miami area honed in on the borrower's financial history and stability, while those in Tampa were more focused on misrepresented property data, the report said.
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From what I have seen around me and experienced this all is no surprise to me. This area is one of the worst with having bad professionals working in real estate.
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