- Interthinx also reports property valuation fraud up 46 percent from a year ago
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AGOURA HILLS, Calif.--(Business Wire)--
Interthinx released its quarterly Mortgage Fraud Risk Report today, covering
data collected during the third quarter of 2009. The report, which includes an
analysis of the state of mortgage fraud nationally and indices for the four most
common types of mortgage fraud, indicates that the overall Interthinx Mortgage
Fraud Risk Index surged more than 11 percent from the previous quarter to 145 (n
= 100). Interthinx is a leading provider of proven risk mitigation, mortgage
fraud prevention, and regulatory compliance tools for the mortgage industry.
The report covers the third quarter of 2009. Major findings include the
following:
* The Property Valuation Fraud Risk Index is up 25 percent from the last quarter
and up 46 percent from the same period a year ago. That shows the continued
shift to schemes involving short sales, REO (Real Estate Owned) inventories, and
refinancing by borrowers whose equity has been impaired by falling real estate
values.
* Despite relatively small variations on the national scale, the Index range
from the lowest to the highest risk state has widened considerably, from 100 to
215. Thus, the riskiest states are now much more risky than a year ago, and the
least risky states are much less risky than a year ago.
* The states with the highest overall levels of mortgage fraud risk correspond
closely to the states with the highest levels of foreclosure activity,
consistent with the observed increase in foreclosure-related fraud schemes.
Fraud risk remains a leading indicator of foreclosure risk.
The full report is available at http://www.interthinx.com/pdf/09_Q3MFRI_FNL.pdf.
The Interthinx Mortgage Fraud Risk Report was created by the new Interthinx
analytics team, composed of seven experienced professionals, four of whom hold
Ph.D.s. Interthinx established the new unit to provide deeper insight into the
extensive pool of data the company amasses from the industry`s use of its
FraudGUARD loan-level fraud detection tool.
Interthinx analysts expect fraud indices will continue to rise over the next
three years as a large number of adjustable rate mortgage loans - especially
option Adjustable Rate Mortgages (ARMs with negative amortization features) -
reset between now and the first quarter of 2012.
"The report provides data that lenders can use to anticipate and prepare for
trends that will impact their risk mitigation strategies and can ultimately make
them more successful at identifying fraud before loans are funded," said Kevin
Coop, president of Interthinx. "Unfortunately, the data do not currently support
a positive trend relative to fraud risk. The industry must be vigilant if it
hopes to guard against fraud, especially in the area of valuation fraud in the
current market."
"Before this report was available, the industry had no easy way to tell
precisely where mortgage fraud was increasing at the greatest rate," added Mike
Zwerner, senior vice president of business development for Interthinx. "The
report provides a granular level of detail that provides actionable information
to risk managers."
For more information about the report, visit http://www.Interthinx.com.
About Interthinx
Interthinx, Inc., a Verisk Analytics subsidiary, is a leading national provider
of proven risk mitigation and regulatory compliance tools for the financial
services industry. At every point in the mortgage life cycle, Interthinx helps
to assess risk and prevent mortgage fraud and compliance violations. More than
1,100 customers - including 15 of the top 20 mortgage lenders and three of the
top five largest financial institutions - employ the company`s products and
services. Interthinx earned Mortgage Technology magazine`s prestigious 10X Award
as "a diagnostic and corrective solution of the highest order," for its
technological expertise in predictive analytics, data mining, and risk scoring.
The Interthinx suite of solutions sets the standard for the industry and
directly increases the value of client portfolios. For more information, visit
www.interthinx.com or call 1-800-333-4510.
About Verisk Analytics
Verisk Analytics is a leading provider of risk assessment solutions to
professionals in insurance, healthcare, mortgage lending, government, risk
management, and human resources. Verisk Analytics includes the holdings of
Insurance Services Office, Inc. (ISO) and its subsidiaries, which provide
essential solutions to the insurance, mortgage lending, and healthcare markets.
For more information, visit www.verisk.com.
Interthinx
Rick Grant, 800-979-9049
Cell: 570-497-1026
rick@rickgrant.net
Copyright Business Wire 2009
