UK fraud prevention service reported this week that last year saw a significant drop in the number of reported mortgage fraud cases – down from 3,542 in 2010 to just 3,153.
The latest CIFAS fraud report details the drop and says that it was mainly down to a fall in the number of mortgage application frauds, going on to suggest that this itself could be a side effect of increased joblessness.
The service argues that unemployment and greater concerns about job prospects in the future, could have deterred the sort of potential mortgage fraudsters who try to obtain larger home loans than they are able to repay, but would nevertheless have had the sincere intention of repaying the mortgage they eventually obtained.
Another symptom of the increased job insecurity at large across the UK could be seen in the sharp increase in the number of mortgage frauds involving the provision of phony or exaggerated employment details. Such frauds are among the most common kinds of mortgage fraud, in which perpetrators typically falsify their payslips or other proof of salary in order to artificially inflate their perceived income.
There may have been an overall fall in mortgage fraud last year, but the number of these kinds of mortgage frauds nearly doubled, from 283 in 2010 to 512. Due to increased unemployment, CIFAS observed, more mortgage fraudsters are having to falsify any earnings, rather than merely inflate the earnings they actually receive.
The good news for mortgage brokers is that the general decline in fraud appears to be part of an ongoing trend, the CIFAS report went on to say.