The risk of mortgage fraud in the third quarter of this year on U.S. home loans shot up 11 percent from the previous quarter, according to Interthinx, a firm that provides fraud prevention services to lenders. But unlike the inflated home values and incomes that marked the mortgage fraud common during the housing boom, things are different this time around. Interthinx, which analyzes mortgage fraud nationally, and uses its risk measure to show where it may be increasing the most, found a continuing shift to schemes involving bank-owned foreclosed homes, and short sales, in which an owner sells the house for less than what’s owed on the mortgage and the lender forgives the remaining debt.
The firm also reported that real estate agents and other professionals increasingly are involved in the schemes, which are growing in popularity due to the abundant supply of foreclosures, and the fact that appraisals frequently aren’t required in order to sell distressed properties.
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