The CoreLogic Quarterly Mortgage Fraud Brief analyzes the metro areas with the highest mortgage fraud risk on a quarterly basis and offers insights based on the analysis of trends found in residential mortgage loan applications processed by LoanSafe Fraud Manager.
Read the report to learn about:
- Factors causing increases in fraud risk
A large drop in loan volumes, combined with a subsequent decline in lower-risk refinances are driving an increase in fraud risk over the last quarter.
- Metros where fraud risk is the highest
Ten of the 15 riskiest metros saw fraud risk increase compared to last quarter.
- Types of fraud causing the most concern
There are several different types of fraud that can impact a mortgage. From occupancy fraud, employment and income fraud to property fraud, external factors can drive what types are fraud are more prevalent than others. Our latest fraud brief highlights key industry trends that are driving specific types of fraud, so you can be aware of what to watch out for.
Get more in-depth insights in the Quarterly Mortgage Fraud Brief and see how you can better protect your business from the growing risk of mortgage fraud.
Download the Q1 2022 Quarterly Mortgage Fraud Brief report
Interested in reading the full report? Let us know where to email the PDF by filling out the form below.
Application Fraud Risk Index Methodology
The CoreLogic Mortgage Application Fraud Risk Index represents the collective level of fraud risk the mortgage industry is experiencing in each time period, based on the share of loan applications with a high risk of fraud. The index is standardized to a baseline of 100 for the share of high-risk loan applications nationally in the third quarter of 2010. In previous reports, the national mortgage fraud index had a static weighted average across indexes computed for various loan segments. The static weighting method ensures that the changes in loan application volume between segments with different fraud characteristics do not spuriously indicate a change in fraud risk patterns. Based on CoreLogic latest research findings, it has been deemed that the national trend is not susceptible to spurious change and the segment weighting has been adjusted quarterly to track market changes.
The number of expected fraudulent applications is estimated by applying the rate of applications in the CoreLogic Mortgage Fraud Consortium data with high risk of fraud to the estimated loan application volume in each quarter and geography. Expected fraudulent mortgage applications are defined as having a high risk of fraud based on the CoreLogic LoanSafe Fraud Manager score.
CoreLogic Mortgage Fraud Consortium data also provides the average application loan amount by quarter and geography for high-risk fraud scores based on the LoanSafe Fraud Manager score. The average loan amount for applications with a high risk of fraud combined with the number of expected fraudulent applications is used to determine the expected total fraudulent application loan amount by quarter and geography.
The application-fraud indexes are based on specific CoreLogic LoanSafe Fraud Manager alerts. These alerts are computed consistently across time for all CoreLogic Mortgage Fraud Consortium members, regardless of whether the client has the alerts enabled or not. Thus, increased firing of an alert indicates increased risk of the corresponding fraud type. Because the CoreLogic Mortgage Application Fraud Risk Index is based on the LoanSafe Fraud Manager score, it provides a more comprehensive and robust indication of fraud trends than would result from simply summing the fraud type indexes.
