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Mortgage fraud on the rise

Staff Reporter 1 minute read

Sydney mortgage brokers are being urged to rigorously check the identity of new borrowers, as the number of identity fraud schemes operating across Australia soars.

According to ABC News, residential mail is being stolen from letterboxes throughout Sydney and then used by fraudsters to satisfy 100 point identification checks for loan applications.

Police believe the recent spate of stolen mail could be part of a larger mortgage fraud syndicate.

NSW State Crime Command media liaison officer Nikki Woloszuk told Mortgage Business that mortgage fraud can occur as a result of several factors including false information regarding the existence of a property, or the capability of a borrower to repay the loan (inflated income), as well as false property valuations.

According to Ms Woloszuk, there are simple steps brokers and lenders can take to prevent mortgage fraud.

“When dealing with a new borrower, brokers and lenders should ensure they randomly check the information provided by loan applicants, use targeted questioning of the individual regarding their employment and/or personal details, as well as ring and check phone numbers provided by the applicants,” she said.

Ms Woloszuk said it is also important for lenders to conduct a physical inspection of the property the applicant is seeking to mortgage.

“Offenders can have industry experience and can make use of loopholes. It is advisable to physically view the [security] property,” she said.

Mortgage fraud on the rise
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