Industry NewsMortgage

Lenders still plagued by fraud

Real estate brief

Mortgage fraud continues to be an issue in newly originated loans, according to a report from the Mortgage Asset Research Institute that shows a 42 percent increase in reported incidents of fraud in loans originated during the first quarter compared to a year ago.MARI identified Florida, California, Illinois, Maryland and Michigan as the states with the biggest mortgage fraud problems, with reports of suspected misrepresentation concentrated in urban areas. Florida accounted for about one in four loans with material misrepresentations nationwide, and the Miami metropolitan statistical area (MSA) accounted for about half of all reports submitted for properties in the state. In California, 52 percent of the properties with misrepresentation are in the Los Angeles MSA. In Illinois, 94 percent of investigations are for properties in the Chicago MSA. In Maryland, 25 percent of reports are in the Baltimore MSA. The Detroit MSA encompasses 56 percent of all of the misrepresentation reported f...