The battle against mortgage fraud goes on

Posted in 'Identity Theft' by Richard Catlin

31 March 2010

One unexpected (but welcome) result of the recession has seen levels of mortgage fraud fall, in line with the drop in activity in the housing market.

Lower mortgage fraud has also been attributed to a combination of increased emphasis on fraud prevention by lenders and a lack of lightly underwritten mortgage products to target arising from the very limited availability of products such as buy-to-let and self-certification mortgages.

There are now fears that a recovery in the housing market will see fraudsters refocus their interest in mortgage fraud.

With this in mind, the National Fraud Authority (NFA), working in conjunction with the Metropolitan Police and organisations including the Land Registry and Council of Mortgage Lenders (CML), has set up a mortgage fraud forum specifically aimed at combating the threat posed by identity fraudsters.

Initiatives include better staff training and fraud identification systems have already helped prevent around £130 million of fraud in the past 12 months, but losses still topped £1 billion. Mortgage fraud is rarely prosecuted successfully, so the major focus is on prevention.

The credit crunch has changed the fraud landscape considerably. With lenders tightening up their acceptance criteria and authentication processes, criminals have switched their focus away from creating false identities to trying to steal genuine ones. As a consequence, identity theft has increased by 25% in 2009 compared to the previous 12 months.

You can find out how you might be at a higher risk of identity theft by using our free Identity Theft Check Service, or for even more peace of mind, monitor your credit report to spot early warning signs of attempted fraud.

At the same time, ensuring that all the information on your credit file is correct will greatly improve your chances of being approved for a mortgage (or re-mortgage) when the time comes. Mortgage approval levels have been fairly flat in the first two months of the year, and so you should look to grab any opportunity you can to improve your chances of being accepted.

Monitor your credit report

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