─ Overall decrease tied to market stabilization with fraud factors
concentrated more locally, shows Interthinx®
2014 annual Mortgage Fraud Risk Report ─
Interthinx, Inc., a subsidiary of First American Financial Corporation
(NYSE: FAF) and a leading provider of comprehensive risk mitigation
solutions for the financial services industry, has released its annual
interactive Mortgage Fraud Risk Report, which includes data
collected in 2014 from loan applications processed by the Interthinx
FraudGUARD® system.
According to the report, the 2014 Annual Mortgage Fraud Risk Index value
is 100, a 4 percent decrease from 2013 that signals a halt in the
gradually rising trend observed in the previous four years. Of the four
type-specific fraud risk indices Interthinx tracks—Property Valuation,
Identity, Occupancy and Employment/ Income—only Property Valuation Risk
increased (by 17 percent). Other noteworthy observations include:
-
Overall, mortgage fraud risk has appeared to normalize;
-
Less overall real estate market volatility with stabilization of real
estate prices and inventory across the nation;
-
Geographic distribution of fraud risk continues to become even more
dispersed in 2014, shifting from entire states towards regional, MSA,
and ZIP code level concentrations;
-
Property valuation and occupancy fraud risk are main drivers of risk
among top 10 riskiest states;
-
With the exception of California, the riskiest states exhibit a
corresponding weak housing market;
-
Better Housing Price Index (HPI) values and overall market health in
states where investor activity is evident;
-
Fraud risk does not appear to trend downward as credit scores increase.
“After three years of increasing fraud risk, the 2014 data show both an
overall decrease and a shift to more localized concentrations of
specific fraud types,” said Jeff Moyer, chief product and strategy
officer at First American Mortgage Solutions. “In no way diminishing the
imperative for lenders, servicers and investors to remain vigilant,
overall market stabilization does allow our industry to focus on more
highly targeted strategies to address specific fraud threats.”
“Taking pre-emptive action against fraud, and the losses related to
fraud, is critically important to protect mortgage lenders and
consumers,” said Mark Fleming, chief economist at First American. “As
real estate and mortgage markets continue to move toward the new,
post-crisis normal, fraud remains a concern that is ever-changing and
requires detection methodologies that account for a variety of risk
types. Rising property fraud prevalence is not surprising given the
economic conditions and rising prices we see today.”
The full report is available at www.mortgagefraudriskreport.com.
The Mortgage Fraud Risk Report is created by an internal team of
fraud experts in order to provide deeper insight into current fraud
trends through the analysis of millions of loan applications collected
from the Interthinx FraudGUARD® loan-level fraud-detection tool. The
2014 report marks the fifth year that Interthinx has released this
information offering.
For more information about Interthinx and its Mortgage Fraud Risk
Report, visit http://www.Interthinx.com.
About the Mortgage Fraud Risk Report
The Mortgage Fraud Risk Report is an Interthinx information
offering created by an internal team of fraud experts. This is the fifth
Interthinx year-end report. The report provides deeper insight into
current fraud trends through the analysis of millions of loan
applications amassed from the industry’s use of the Interthinx FraudGUARD®
loan-level fraud detection tool. The Fraud Risk indices are influenced
by many factors including house price indices, concentrations of
defaulted and foreclosed properties, market demand and supply,
employment rates, collusion by parties to loan transactions, regulation,
and changing consumer patterns. By analyzing the data in the Mortgage
Fraud Risk Report, it is possible to reach conclusions linked to the
overall market experience and gain actionable intelligence to empower
risk mitigation in real time.
For more information about Interthinx and its Mortgage Fraud Risk
Report, please visit http://www.Interthinx.com.
About Interthinx
Interthinx, Inc., a subsidiary of First American Financial Corporation
(NYSE: FAF), provides essential solutions to mitigate risk in the
mortgage lending marketplace. Interthinx offers capabilities in mortgage
fraud and verification, property valuation, compliance, quality control
and loss mitigation that are used by the nation's top financial
institutions. Interthinx helps its clients minimize risk, increase
operational efficiencies, satisfy regulator demands, manage data
verification and remain compliant. For more information, visit www.interthinx.com
or call 1-800-333-4510.
About First American
First American Financial Corporation (NYSE: FAF)
is a leading provider of title insurance, settlement services and risk
solutions for real estate transactions that traces its heritage back to
1889. First American also provides title plant management services;
title and other real property records and images; valuation products and
services; home warranty products; property and casualty insurance; and
banking, trust and investment advisory services. With revenues of $4.7
billion in 2014, the company offers its products and services directly
and through its agents throughout the United States and abroad. More
information about the company can be found at www.firstam.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150625005347/en/
Copyright Business Wire 2015