The troubled housing market is bringing out all sorts of scam artists – people looking to make a quick buck, at the expense of others.
Despite tightened lending standards and a greater focus on fraud, the chances of fraud occurring in new mortgages is very high. Interthinx, a California-based company that provides risk mitigation and fraud prevention tools to the mortgage industry, released a study showing mortgages are less likely to involve fraud now than during the first part of the year. Its national mortgage fraud risk index dropped 3% when compared to the first three months of 2010. Keep in mind, though, the overall risk of fraud is still elevated to an index of 145. A reading of 100 is considered “normal” fraud risk. The company reports that once mortgage fraud takes hold in an area, it’s hard to get rid of. Nevada, Arizona and California top the list. At the zip-code level, Chicago takes top prize.