Mortgage Fraud Risk Report
Q1 2012
Mortgage Fraud Risk Report In depth analysis of nationwide risk as indicated by the Interthinx® Fraud Risk Indices
© Interthinx, Inc. 2012. All rights reserved. Interthinx and FraudGUARD are registered trademarks of Verisk Analytics. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission. The information contained within should not be construed as a recommendation by Interthinx, Inc. or Verisk Analytics for any course of action regarding financial, legal or accounting matters.
Mortgage Fraud Risk Report
Q1 2012
1
Executive Summary The national Mortgage Fraud Risk Index is 139 (n = 100), a decrease of 4.3 percent from the last quarter and 3.1 percent from a year ago. This is the first time the national index has slipped below the 140 mark since the second quarter of 2009. • Nevada regained the mantle of “Riskiest State,” after being displaced by Arizona in Q4 2011. Nevada has, with only three exceptions, occupied this position since the inception of this report in Q2 2009. • Florida was the third riskiest state after Nevada and Arizona. It contains the two riskiest metropolitan statistical areas (MSAs) –Cape Coral and Miami– and half of the top 10 riskiest ZIP codes in the nation. It is also well-represented in the top 10 lists for Property Valuation, Identity, and Occupancy Fraud Risk. • California, a historically high risk state, experienced a significant decline with its index value falling from 192 last quarter to 173 this quarter. The decrease is most apparent in the state’s Central Valley MSAs and is epitomized by Stockton, which slipped to 7th in the list of the riskiest MSAs after occupying first place for the past three quarters. California’s representation in type-specific risk has decreased in all categories except Employment/ Income, where eight of the top 10 riskiest metros belong to the “Golden” State. • The New York Tri-State area, highlighted last quarter because of a significant increase in risk, saw additional increases in risk this quarter. In particular, New Jersey took over from California as the fourth riskiest state –its highest rank since the inception of this report– and New York moved into 10th place, the first time it has entered the top 10. In addition, the two riskiest ZIP codes in the nation were located in the Tri-State area. • The Employment/Income Fraud Risk index saw continued growth this quarter, gaining five percent on the quarter, 18 percent over the last year, and 37 percent over the past two years. • As already low mortgage rates have fallen further to new historical lows, there has been a surge in refinancing activity. The resulting change in the composition of loan applications is at least partly responsible for many of the trends seen over the last year.
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Q1 2012
2
Mortgage Fraud Risk Hot Spots and Trends The national Mortgage Fraud Risk Index is 139 (n = 100), representing decreases of 4.3 percent from the last quarter and 3.1 percent from a year ago. This is the first time the national index has slipped below the 140 mark since the second quarter of 2009. Consistent with the decrease in the national index, the number of “very high risk” metros decreased from 67 to 62. While the “very high risk” MSAs continue to be distributed throughout the nation, California and Florida together account for more than half of the MSAs classified as “very high risk,” while Michigan, Ohio, Colorado, and Arizona metros account for another fifth on this list. Returning to this list from last quarter are the metros of Mobile, Alabama; Bridgeport and New Haven, Connecticut; Atlanta, Georgia; Las Vegas and Reno, Nevada; New York City; Cleveland, Ohio; Salem, Oregon; Philadelphia, Pennsylvania; Chattanooga, Tennessee; and Burlington, Vermont. Making their first appearances in the “very high risk” category are Rockford, Illinois; Jacksonville, North Carolina; and Toledo, Ohio. Trenton, New Jersey and Akron, Ohio return to this category after a lapse of several quarters.
MORTGAGE FRAUD RISK
Figure 1: Mortgage Fraud Risk in Q1 2012 by Metropolitan Statistical Area (MSA)
Mortgage Fraud Risk Report
Q1 2012
3
Table 1 shows the 10 MSAs with the highest mortgage fraud risk. While California MSAs represent five of the top 10, the Central Valley MSAs that previously had the highest risk saw significant declines. Most notable is Stockton, which, with a decrease of 24 percent from last quarter, fell to 7th place after holding first place for the previous three quarters. The Florida MSAs of Cape Coral and Miami now occupy the top two spots. Completing the list are Las Vegas, Nevada and Phoenix, Arizona –both repeats from the previous quarter– and a new addition, Mobile, Alabama. The very high risk in Mobile is notable because Alabama is a low risk state with an index value of 114 – well below the national value of 139. In keeping with the decreases in the national index, even among these riskiest states there is a general decline in fraud risk, with eight of the 10 MSAs seeing decreases over Q4 2011. The exceptions are Chico, California and Mobile, Alabama. Rank
1 2 3 4 5 6 7 8 9 10
Metropolitan Statistical Area
Cape Coral-Fort Myers, FL Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Modesto, CA Metro Chico, CA Metro Las Vegas-Paradise, NV Metro Phoenix-Mesa-Scottsdale, AZ Metro Vallejo-Fairfield, CA Metro Stockton, CA Metro Mobile, AL Metro Fresno, CA Metro UNITED STATES
Mortgage Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
248 241 241 229 229 229 223 222 220 219 139
1.4% 1.1% -10.7% 37.2% -8.2% -9.7% 1.5% -21.3% 58.6% 7.0% -3.1%
-8.5% -5.5% -15.3% 30.2% -14.2% -18.5% -15.9% -24.2% 33.8% -3.6% -4.3%
8-quarter Trend
Table 1: MSAs with the Highest Fraud Risk in Q1 2012
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Q1 2012
4
Table 2 shows the Mortgage Fraud Risk Index for the 10 ZIP codes with the highest mortgage fraud risk. Half of these are in Florida, up from a single ZIP code last quarter. The two riskiest ZIP codes, 07012 and 11434, are located in the Tri-State area, a region that has seen increasing risk in recent quarters. One ZIP each from Maryland, Alabama and Nevada round out the top 10. California, which has historically been well and consistently represented here, is notably absent from this list. Rank
ZIP
City and State
Mortgage Fraud Risk Index Q1 2012
1
07012
Clifton, New Jersey
501
2
11434
Jamaica, New York
484
3
33032
Homestead, Florida
458
4
20747
District Heights, Maryland
455
5
33971
Lehigh Acres, Florida
451
6
35810
Huntsville, Alabama
442
7
33634
Tampa, Florida
437
8
33056
Lake Lucerne, Florida
432
9
32822
Orlando, Florida
429
10
89104
Las Vegas, Nevada
429
Table 2: ZIP codes with the Highest Fraud Risk in Q1 2012
Mortgage Fraud Risk Report
Q1 2012
5
Geographic Fraud Risk Migration Mortgage fraud migrates geographically to take advantage of local market conditions. This section examines the geographic migration of mortgage fraud risk within the 50 States and the District of Columbia.
300 250 200
Mortgage Fraud Risk Index for the United States is 145
150 100 50 0
Arizona Nevada Florida California Connecticut Michigan New Jersey Georgia Colorado Oregon Tennessee Vermont Hawaii Pennsylvania Washington Utah New York Minnesota South Carolina Texas Illinois Ohio Maryland District of Columbia North Carolina Wyoming Wisconsin Virginia New Hampshire Missouri Idaho Nebraska Oklahoma Arkansas Massachusetts Delaware Alabama Rhode Island Montana Indiana New Mexico Mississippi Louisiana Kentucky Alaska North Dakota Iowa South Dakota Maine West Virginia Kansas
Mortgage Fraud Risk Index
Figure 2 depicts the Mortgage Fraud Risk Index for the individual states, with the 10 highest risk states shown in red. Nevada reclaimed its spot at the top of the list after being overtaken by Arizona last quarter. Nevada has, with only three exceptions, occupied this position since the inception of this report in Q2 2009. That said, both of these historically risky states saw strong declines to their index values, with Nevada’s index decreasing from 242 to 221, and Arizona’s from 247 to 213. Florida, in third place, is the only other state with an index value greater than 200. New Jersey saw a strong increase in fraud risk: with a 12 point increase in its index that saw it move from 7th place last quarter to 4th place –its highest rank since the inception of this report– it pushed the perennially risky California to 5th place. Georgia, Michigan, Connecticut and Colorado all continue in the top 10. New to this list is New York, whose 12 point jump saw it move to 10th place from 17th place last quarter. This, together with New Jersey’s movement up the list and Connecticut continuing in the top 10, provides further evidence of the increasing trend in fraud risk in the Tri-State area first noted in the Q4 2011 report. Nine of the 10 lowest risk states (shown in green) make a return this quarter. The sole new addition is Montana, which is now the 8th least risky state with an index value of 67. All of these states have index values less than half of the national value.
Figure 2: Mortgage Fraud Risk Index in Q1 2012 by State
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Q1 2012
6
Type-Specific Mortgage Fraud Risk Hot Spots and Trends Interthinx tracks four type-specific fraud risk indices: Property Valuation, Identity, Occupancy and Employment/Income. This section examines the hot spots and trends for these type-specific fraud risks. PROPERTY VALUATION FRAUD RISK INDEX
Property Valuation Fraud is perpetrated by manipulating property value to create “equity” which is then extracted from loan proceeds by various means. Table 3 shows the 10 MSAs with the highest property valuation fraud risk. While California held seven of these spots last quarter, Florida is now the riskiest state, increasing its representation from one metro in last quarter’s list to half of the metros this quarter. Among these are the nation’s riskiest metro –Cape Coral, with an index value of 482, more than twice the national value– and 3rd place Port St. Lucie. The trend in the right-most column shows that Port St. Lucie’s quarter-on-quarter and year-onyear increases of around 50 percent erased previous improvements and return its index to the level it had for most of 2010. California, by comparison, is now represented by only two metros: Chico and Modesto. Stockton, California, which came in first last quarter and has perennially been high risk, is conspicuously absent. This shift in the top 10’s composition is not so much due to increasing fraud risk in Florida, but to an abrupt drop in fraud risk in many of California’s Central Valley metros. New to the list is Alabama’s Mobile metro, whose index value has increased by nearly 60 percent from last quarter, and by almost 100 percent from one year ago. Rounding out the top 10 are Phoenix, Arizona and Las Vegas, Nevada. The national value went down 12 percent this quarter, erasing the increase observed in the previous quarter.
Rank
1 2 3 4 5 6 7 8 9 10
Metropolitan Statistical Area
Cape Coral-Fort Myers, FL Metro Las Vegas-Paradise, NV Metro Port St. Lucie, FL Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Phoenix-Mesa-Scottsdale, AZ Metro Mobile, AL Metro Modesto, CA Metro Deltona-Daytona Beach-Ormond Beach, FL Metro Chico, CA Metro Orlando-Kissimmee, FL Metro UNITED STATES
Property Valuation Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
482 440 439 435 434 417 414 409 404 401 213
3.7% -19.9% 48.4% 1.2% -19.9% 93.4% -21.7% 28.5% 46.7% 7.0% -4.7%
-18.4% -24.5% 50.6% -6.0% -28.6% 59.7% -32.5% 14.1% 19.2% -9.0% -11.8%
8-quarter Trend
Table 3: MSAs with the Highest Property Valuation Fraud Risk
Mortgage Fraud Risk Report
Q1 2012
7
IDENTITY FRAUD RISK INDEX
Identity fraud is frequently used in mortgage fraud schemes in order to hide the identity of the perpetrators and/or to obtain a credit profile that will meet lender guidelines. Table 4 displays the top 10 MSAs for identity fraud risk. San Jose, California takes over the top spot from Miami, Florida, which, with a 22 percent decrease in its index, moved down to fifth place. Two other California MSAs (Vallejo and Los Angeles) and one other Florida MSA (Naples) also make the top 10. Detroit is in second place, with another Michigan MSA – Ann Arbor – in fourth. The Tri-State area also accounts for two metros: Trenton, New Jersey and New York City. The list is rounded out by Tulsa, Oklahoma, which comes in fourth on the strength of its 164 percent increase from Q4 2011 value. The trend in the right-most column shows that the quarter-on-quarter and year-on-year increases of over 100 percent return Tulsa’s index to levels not seen in two years. The national value declined two percent from Q4 2011 and by 22 percent from one year ago, continuing the downward trend observed over the past five quarters.
Rank
1 2 3 4 5 6 7 8 9 10
Identity Fraud Risk Index Q1 2012
Metropolitan Statistical Area
San Jose-Sunnyvale-Santa Clara, CA Metro Detroit-Warren-Livonia, MI Metro Tulsa, OK Metro Ann Arbor, MI Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Vallejo-Fairfield, CA Metro Trenton-Ewing, NJ Metro Naples-Marco Island, FL Metro New York et al, NY-NJ-PA Metro Los Angeles-Long Beach-Santa Ana, CA Metro UNITED STATES
293 281 276 271 267 258 254 244 240 225 140
% Change since Q1 2011
% Change since Q4 2011
18.3% 7.6% 122.0% 21.6% -15.0% 62.7% -11.6% 169.0% -7.8% -5.4% -22.4%
-7.2% -3.2% 163.6% 27.2% -21.5% 66.1% 47.7% -6.9% -4.9% 1.8% -2.2%
8-quarter Trend
Table 4: MSAs with the Highest Identity Fraud Risk
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Q1 2012
8
OCCUPANCY FRAUD RISK INDEX
Occupancy Fraud is perpetrated by investors who falsely claim the intent to occupy the purchased property so as to obtain a mortgage with lower down payments and/or interest rates. Table 5 shows the 10 MSAs with the highest Occupancy Fraud Risk. Of these, only three –Miami in 1st, Modesto in 4th, and Detroit in 6th– return from the previous quarter. Miami is rated as the riskiest, moving up from 2nd place last quarter. The remainder of the list is geographically distributed throughout the United States with no clear concentration. The inclusion of Tulsa, Oklahoma, making its second appearance on a top 10 list this quarter, is notable because it has not previously appeared in any Mortgage Fraud Risk reports. Many of these metros make an appearance following double digit gains, including Jacksonville, North Carolina; Cleveland, Ohio; Killeen, Texas; Milwaukee, Wisconsin; and the aforementioned Tulsa. The national value is up two percent from the last quarter, but sharp decreases over previous quarters leave it 23 percent lower than one year ago. Rank
1 2 3 4 5 6 7 8 9 10
Occupancy Fraud Risk Index Q1 2012
Metropolitan Statistical Area
Miami-Fort Lauderdale-Pompano Beach, FL Metro Jacksonville, NC Metro Flint, MI Metro Modesto, CA Metro Cleveland-Elyria-Mentor, OH Metro Detroit-Warren-Livonia, MI Metro Kileen-Temple-Fort Hood, TX Metro Vallejo-Fairfield, CA Metro Milwaukee-Waukesha-West Allis, WI Metro Tulsa, OK Metro UNITED STATES
104 102 98 97 97 97 97 92 90 89 61
% Change since Q1 2011
% Change since Q4 2011
-26.0% 87.3% -20.1% -26.8% 9.1% -30.8% 35.8% -1.8% 50.3% 48.6% -23.2%
-23.6% 29.6% -12.2% -7.9% 30.3% -8.1% 26.5% -4.2% 73.5% 48.6% 2.1%
8-quarter Trend
Table 5: MSAs with the Highest Occupancy Fraud Risk
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Q1 2012
9
EMPLOYMENT/INCOME FRAUD RISK INDEX
Employment/Income Fraud occurs when an applicant’s income is misrepresented in order to meet lender underwriting guidelines for a loan. Table 6 displays the top 10 MSAs for employment/income fraud risk. California is the clear leader, laying claim to eight of these 10 metros, up from five last quarter. That said, Burlington, Vermont –a repeat from last quarter– comes in first by a margin of 80 points. Bridgeport, Connecticut rounds out the list. All of these metros experienced increases to their index values, and for the most part these gains were significant. The increase in the national value –nearly 5 percent on the quarter, 18 percent on the year and 37 percent over two years– is further evidence of the noteworthy growth of employment/income fraud risk.
Rank
Metropolitan Statistical Area
Employment/Income Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
1 2 3 4 5 6 7 8 9 10
Burlington-South Burlington, VT Metro San Diego-Carlsbad-San Marcos, CA Metro Modesto, CA Metro San Jose-Sunnyvale-Santa Clara, CA Metro Bridgeport-Stamford-Norwalk, CT Metro Los Angeles-Long Beach-Santa Ana, CA Metro Oxnard-Thousand Oaks-Ventura, CA Metro San Francisco-Oakland-Fremont, CA Metro Vallejo-Fairfield, CA Metro Chico, CA Metro UNITED STATES
271 191 188 188 184 180 180 178 178 178 121
8.8% 23.3% 8.5% 15.4% 10.5% 11.7% 33.1% 21.1% 67.2% 35.8% 18.1%
6.2% 24.5% 23.8% 19.6% 26.7% 15.1% 44.6% 3.7% 12.4% 39.7% 4.5%
8-quarter Trend
Table 6: MSAs with the Highest Employment/Income Fraud Risk
Mortgage Fraud Risk Report
Q1 2012
10
Increase in Refinance Applications Figure 3 shows that over the last two years there has been a close correlation between the proportion of refinancing applications in the FraudGUARD®system and the prevailing mortgage rates. Reflecting national trends, low mortgage rates resulted in increased levels of refinances relative to purchases. Therefore, as already low rates dropped to increasingly record lows over the last year, a surge in refinancing activity caused a distinct change in the composition of loan applications in the FraudGUARD system, from a nearly 60:40 split between purchases and refinances in Q2 2011 to a 40:60 split in the current quarter. This section examines the implications of this change in composition.
6.0
100%
5.5
30-Year Fixed-Rate
80% 70%
5.0
60% 4.5
50% 40%
4.0
30% 20%
3.5
10% 3.0 Q1 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
0% Q1 2010
30-Year Fixed-Rate, Percentage
90%
Proportion of Loan Applications that are for Refinances, Percentage
Percent of Loan Applications that are for Refinances
Composition of Loans by Purpose, Q2 2011 to Q1 2012 Percentage of Loan Applications
100% 90%
Purchases
80% 70% 60% 50%
Refinances
40% 30% 20% 10%
All Else
0%
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Figure 3: Mortgage Rates and Proportion of Refinancing Application, Q1 2010 to Q1 2012
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Q1 2012
11
Table 7 shows the top 10 riskiest states in terms of refinances and purchases for the current quarter. There are a number of differences between the two lists that suggest that some of the major geographical trends that have been seen over the last year have been at least partially due to the change in composition of the loans. The clearest example is in the Tri-State area where fraud risk in repurchases is much higher than in purchases. New Jersey (4th), New York (9th) and Connecticut (10th) all feature in the top 10 for refinances, while only New Jersey (7th) makes the top 10 in the purchases table. As refinancing activity surpassed purchases, the risk in the Tri-State area relative to the rest of the nation increased as well.
Rank
State
Mortgage Fraud Risk Index Q1 2012 for Refinances
Rank
State
Mortgage Fraud Risk Index Q1 2012 for Purchases
1
Nevada
261
1
Arizona
215
2
Arizona
209
2
Florida
203
3
Florida
202
3
Nevada
203
4
New Jersey
190
4
California
185
5
California
165
5
Georgia
173
6
Georgia
161
6
Colorado
169
7
Ohio
158
7
New Jersey
165
8
Michigan
155
8
Michigan
160
9
New York
153
9
Maryland
155
10
Connecticut
151
10
Tennessee
150
Table 7: States with Highest Mortgage Fraud Risk for Refinances and Purchases
Mortgage Fraud Risk Report
Q1 2012
12
Table 8 shows the type-specific fraud risk indices segregated by refinances and purchases, as well as the percent change in the overall index values over the last four quarters. The most significant trends are in the Identity and Occupancy Fraud Risk Indices, which have seen decreases of 22 and 23 percent respectively, and the Employment/Income Fraud Risk Index, which saw an increase of 18 percent. Both indices that decreased have lower index values for refinances relative to purchases, while the reverse is true for the Employment/Income Index. This suggests that at least part of the major type-specific trends over the last four quarters is due to the change in loan composition.
Fraud Risk Index
Refinances Q1 2012
Purchases Q1 2012
Percent Change Q1 2011 to Q1 2012
-3.1%
Mortgage Fraud Risk Index
136
142
Property Valuation Fraud Risk Index
214
205
-4.7%
Identity Fraud Risk Index
123
169
-22.4%
Occupancy Fraud Risk Index
42
90
-23.2%
Employment/Income Fraud Risk Index
130
103
18.1%
Table 8: States with Highest Mortgage Fraud Risk for Refinances and Purchases
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Q1 2012
13
Extended Forecast The Interthinx Fraud Risk Indices have proven to be a leading indicator of default and foreclosure activity. Therefore, the regions that currently have high Fraud Risk Indices are likely to continue to experience high foreclosure rates going forward. Based on the Fraud Risk Indices, regions that bear close scrutiny going forward include: • Nevada and Arizona, which continue to be the two riskiest states. • Florida, which contained the two riskiest MSAs (Cape Coral and Miami), contained half of the top 10 riskiest ZIP codes, and was well-represented in the Property Valuation, Identity, and Occupancy top 10 lists. • The New York Tri-State area, where fraud risk continued to rise with all three states – New Jersey, Connecticut and New York– making the top 10 in 4th, 8th and 10th places, respectively. In addition, the two riskiest ZIP codes were located in the Tri-State area. • California, which, despite a significant decline in risk this quarter, is still the 5th riskiest state, contains five of the 10 MSAs with the highest fraud risk, and eight of the 10 MSAs with the highest employment/income fraud risk.
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Q1 2012
14
About the Interthinx Fraud Risk Indices The Fraud Risk Indices are calculated based on the frequency with which indicators of fraudulent activity are detected in mortgage applications processed by the Interthinx FraudGUARD®system, a leading loan-level fraud detection tool available to lenders and investors. The Interthinx Fraud Risk Indices consist of the Mortgage Fraud Risk Index, which measures the overall risk of mortgage fraud, and the Property Valuation, Identity, Occupancy and Employment/Income Indices, which measure the risk of these specific types of fraudulent activity. The Mortgage Fraud Risk Index considers 40+ indicators of fraudulent activity including property mis-valuation; identity, occupancy and employment/income misrepresentation; non arms-length transactions; property flipping; straw-buyers; “silent seconds”; and concurrent closing schemes. The four type-specific indices are based on the subset of indicators that are relevant to each type of fraudulent activity. Each Index is calibrated so that a value of 100 represents a nominal level of fraud risk, a value calculated from the occurrence of fraudulent indicators between 2003 and 2007 in states with low foreclosure levels. For all five indices, a high value indicates an elevated risk of mortgage fraud and each Index is linear to simplify comparison across time and location. The Interthinx Indices are leading indicators based predominantly on the analysis of current loan originations. FBI and FinCEN reports are lagging indicators because they are derived primarily from Suspicious Activity Reports (SARs), the majority of which are filed after the loans have closed. The time lag between origination and the SAR report can be several years. For this reason, the Interthinx Fraud Risk Indices’ top geographies and type-specific findings may differ from FBI and FinCEN fraud reports.
Mortgage Fraud Risk Report
Q1 2012
15
About the Interthinx Mortgage Fraud Risk Report The Interthinx Fraud Risk Report represents an in-depth analysis of residential mortgage fraud risk throughout the United States as indicated by the Interthinx Fraud Risk Indices. Published quarterly, as part of the Fraud Risk Report, Interthinx will report on the geographic regions with the highest Mortgage Fraud Risk Index as well as those with the highest Property Valuation, Identity, Occupancy, and Employment/Income Fraud Risk Indices. The Interthinx Fraud Risk Indices track these risks in all States, Metropolitan areas, Counties and county equivalents, throughout the United States.
About Interthinx Interthinx, a Verisk Analytics subsidiary, is a leading national provider of comprehensive risk mitigation solutions focusing on mortgage fraud, collateral risk and valuation, regulatory compliance, forensic loan audit services, loss mitigation, and loss forecasting. With more than 20 years of experience in customizable risk evaluation technology, Interthinx offers proven and effective predictive analytics to the residential mortgage industry through its experience with millions of loan applications and fraud incident data from thousands of monthly loan reviews. Throughout the mortgage life cycle, the Interthinx suite of services can increase the value of client portfolios with its comprehensive and holistic approach to loan quality and compliance. Winner of multiple awards for technology, Interthinx helps clients reduce risk, increase operational efficiencies, satisfy regulator demands, manage data verification, remain compliant and mitigate loan buybacks. The Interthinx quarterly Mortgage Fraud Risk Report is a standard for the financial services industry. For more information, visit interthinx.com or call 1-800-333-4510. MEDIA CONTACT: Rick Grant Telephone: 800-979-9049 Cell: 570-497-1026 Email: [email protected]
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Q1 2012
16
Mortgage Fraud Risk Report In depth analysis of nationwide risk as indicated by the Interthinx® Fraud Risk Indices
© Interthinx, Inc. 2012. All rights reserved. Interthinx and FraudGUARD are registered trademarks of Verisk Analytics. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission. The information contained within should not be construed as a recommendation by Interthinx, Inc. or Verisk Analytics for any course of action regarding financial, legal or accounting matters.
Mortgage Fraud Risk Report
Q1 2012
1
Executive Summary The national Mortgage Fraud Risk Index is 139 (n = 100), a decrease of 4.3 percent from the last quarter and 3.1 percent from a year ago. This is the first time the national index has slipped below the 140 mark since the second quarter of 2009. • Nevada regained the mantle of “Riskiest State,” after being displaced by Arizona in Q4 2011. Nevada has, with only three exceptions, occupied this position since the inception of this report in Q2 2009. • Florida was the third riskiest state after Nevada and Arizona. It contains the two riskiest metropolitan statistical areas (MSAs) –Cape Coral and Miami– and half of the top 10 riskiest ZIP codes in the nation. It is also well-represented in the top 10 lists for Property Valuation, Identity, and Occupancy Fraud Risk. • California, a historically high risk state, experienced a significant decline with its index value falling from 192 last quarter to 173 this quarter. The decrease is most apparent in the state’s Central Valley MSAs and is epitomized by Stockton, which slipped to 7th in the list of the riskiest MSAs after occupying first place for the past three quarters. California’s representation in type-specific risk has decreased in all categories except Employment/ Income, where eight of the top 10 riskiest metros belong to the “Golden” State. • The New York Tri-State area, highlighted last quarter because of a significant increase in risk, saw additional increases in risk this quarter. In particular, New Jersey took over from California as the fourth riskiest state –its highest rank since the inception of this report– and New York moved into 10th place, the first time it has entered the top 10. In addition, the two riskiest ZIP codes in the nation were located in the Tri-State area. • The Employment/Income Fraud Risk index saw continued growth this quarter, gaining five percent on the quarter, 18 percent over the last year, and 37 percent over the past two years. • As already low mortgage rates have fallen further to new historical lows, there has been a surge in refinancing activity. The resulting change in the composition of loan applications is at least partly responsible for many of the trends seen over the last year.
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Q1 2012
2
Mortgage Fraud Risk Hot Spots and Trends The national Mortgage Fraud Risk Index is 139 (n = 100), representing decreases of 4.3 percent from the last quarter and 3.1 percent from a year ago. This is the first time the national index has slipped below the 140 mark since the second quarter of 2009. Consistent with the decrease in the national index, the number of “very high risk” metros decreased from 67 to 62. While the “very high risk” MSAs continue to be distributed throughout the nation, California and Florida together account for more than half of the MSAs classified as “very high risk,” while Michigan, Ohio, Colorado, and Arizona metros account for another fifth on this list. Returning to this list from last quarter are the metros of Mobile, Alabama; Bridgeport and New Haven, Connecticut; Atlanta, Georgia; Las Vegas and Reno, Nevada; New York City; Cleveland, Ohio; Salem, Oregon; Philadelphia, Pennsylvania; Chattanooga, Tennessee; and Burlington, Vermont. Making their first appearances in the “very high risk” category are Rockford, Illinois; Jacksonville, North Carolina; and Toledo, Ohio. Trenton, New Jersey and Akron, Ohio return to this category after a lapse of several quarters.
MORTGAGE FRAUD RISK
Figure 1: Mortgage Fraud Risk in Q1 2012 by Metropolitan Statistical Area (MSA)
Mortgage Fraud Risk Report
Q1 2012
3
Table 1 shows the 10 MSAs with the highest mortgage fraud risk. While California MSAs represent five of the top 10, the Central Valley MSAs that previously had the highest risk saw significant declines. Most notable is Stockton, which, with a decrease of 24 percent from last quarter, fell to 7th place after holding first place for the previous three quarters. The Florida MSAs of Cape Coral and Miami now occupy the top two spots. Completing the list are Las Vegas, Nevada and Phoenix, Arizona –both repeats from the previous quarter– and a new addition, Mobile, Alabama. The very high risk in Mobile is notable because Alabama is a low risk state with an index value of 114 – well below the national value of 139. In keeping with the decreases in the national index, even among these riskiest states there is a general decline in fraud risk, with eight of the 10 MSAs seeing decreases over Q4 2011. The exceptions are Chico, California and Mobile, Alabama. Rank
1 2 3 4 5 6 7 8 9 10
Metropolitan Statistical Area
Cape Coral-Fort Myers, FL Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Modesto, CA Metro Chico, CA Metro Las Vegas-Paradise, NV Metro Phoenix-Mesa-Scottsdale, AZ Metro Vallejo-Fairfield, CA Metro Stockton, CA Metro Mobile, AL Metro Fresno, CA Metro UNITED STATES
Mortgage Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
248 241 241 229 229 229 223 222 220 219 139
1.4% 1.1% -10.7% 37.2% -8.2% -9.7% 1.5% -21.3% 58.6% 7.0% -3.1%
-8.5% -5.5% -15.3% 30.2% -14.2% -18.5% -15.9% -24.2% 33.8% -3.6% -4.3%
8-quarter Trend
Table 1: MSAs with the Highest Fraud Risk in Q1 2012
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Q1 2012
4
Table 2 shows the Mortgage Fraud Risk Index for the 10 ZIP codes with the highest mortgage fraud risk. Half of these are in Florida, up from a single ZIP code last quarter. The two riskiest ZIP codes, 07012 and 11434, are located in the Tri-State area, a region that has seen increasing risk in recent quarters. One ZIP each from Maryland, Alabama and Nevada round out the top 10. California, which has historically been well and consistently represented here, is notably absent from this list. Rank
ZIP
City and State
Mortgage Fraud Risk Index Q1 2012
1
07012
Clifton, New Jersey
501
2
11434
Jamaica, New York
484
3
33032
Homestead, Florida
458
4
20747
District Heights, Maryland
455
5
33971
Lehigh Acres, Florida
451
6
35810
Huntsville, Alabama
442
7
33634
Tampa, Florida
437
8
33056
Lake Lucerne, Florida
432
9
32822
Orlando, Florida
429
10
89104
Las Vegas, Nevada
429
Table 2: ZIP codes with the Highest Fraud Risk in Q1 2012
Mortgage Fraud Risk Report
Q1 2012
5
Geographic Fraud Risk Migration Mortgage fraud migrates geographically to take advantage of local market conditions. This section examines the geographic migration of mortgage fraud risk within the 50 States and the District of Columbia.
300 250 200
Mortgage Fraud Risk Index for the United States is 145
150 100 50 0
Arizona Nevada Florida California Connecticut Michigan New Jersey Georgia Colorado Oregon Tennessee Vermont Hawaii Pennsylvania Washington Utah New York Minnesota South Carolina Texas Illinois Ohio Maryland District of Columbia North Carolina Wyoming Wisconsin Virginia New Hampshire Missouri Idaho Nebraska Oklahoma Arkansas Massachusetts Delaware Alabama Rhode Island Montana Indiana New Mexico Mississippi Louisiana Kentucky Alaska North Dakota Iowa South Dakota Maine West Virginia Kansas
Mortgage Fraud Risk Index
Figure 2 depicts the Mortgage Fraud Risk Index for the individual states, with the 10 highest risk states shown in red. Nevada reclaimed its spot at the top of the list after being overtaken by Arizona last quarter. Nevada has, with only three exceptions, occupied this position since the inception of this report in Q2 2009. That said, both of these historically risky states saw strong declines to their index values, with Nevada’s index decreasing from 242 to 221, and Arizona’s from 247 to 213. Florida, in third place, is the only other state with an index value greater than 200. New Jersey saw a strong increase in fraud risk: with a 12 point increase in its index that saw it move from 7th place last quarter to 4th place –its highest rank since the inception of this report– it pushed the perennially risky California to 5th place. Georgia, Michigan, Connecticut and Colorado all continue in the top 10. New to this list is New York, whose 12 point jump saw it move to 10th place from 17th place last quarter. This, together with New Jersey’s movement up the list and Connecticut continuing in the top 10, provides further evidence of the increasing trend in fraud risk in the Tri-State area first noted in the Q4 2011 report. Nine of the 10 lowest risk states (shown in green) make a return this quarter. The sole new addition is Montana, which is now the 8th least risky state with an index value of 67. All of these states have index values less than half of the national value.
Figure 2: Mortgage Fraud Risk Index in Q1 2012 by State
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Q1 2012
6
Type-Specific Mortgage Fraud Risk Hot Spots and Trends Interthinx tracks four type-specific fraud risk indices: Property Valuation, Identity, Occupancy and Employment/Income. This section examines the hot spots and trends for these type-specific fraud risks. PROPERTY VALUATION FRAUD RISK INDEX
Property Valuation Fraud is perpetrated by manipulating property value to create “equity” which is then extracted from loan proceeds by various means. Table 3 shows the 10 MSAs with the highest property valuation fraud risk. While California held seven of these spots last quarter, Florida is now the riskiest state, increasing its representation from one metro in last quarter’s list to half of the metros this quarter. Among these are the nation’s riskiest metro –Cape Coral, with an index value of 482, more than twice the national value– and 3rd place Port St. Lucie. The trend in the right-most column shows that Port St. Lucie’s quarter-on-quarter and year-onyear increases of around 50 percent erased previous improvements and return its index to the level it had for most of 2010. California, by comparison, is now represented by only two metros: Chico and Modesto. Stockton, California, which came in first last quarter and has perennially been high risk, is conspicuously absent. This shift in the top 10’s composition is not so much due to increasing fraud risk in Florida, but to an abrupt drop in fraud risk in many of California’s Central Valley metros. New to the list is Alabama’s Mobile metro, whose index value has increased by nearly 60 percent from last quarter, and by almost 100 percent from one year ago. Rounding out the top 10 are Phoenix, Arizona and Las Vegas, Nevada. The national value went down 12 percent this quarter, erasing the increase observed in the previous quarter.
Rank
1 2 3 4 5 6 7 8 9 10
Metropolitan Statistical Area
Cape Coral-Fort Myers, FL Metro Las Vegas-Paradise, NV Metro Port St. Lucie, FL Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Phoenix-Mesa-Scottsdale, AZ Metro Mobile, AL Metro Modesto, CA Metro Deltona-Daytona Beach-Ormond Beach, FL Metro Chico, CA Metro Orlando-Kissimmee, FL Metro UNITED STATES
Property Valuation Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
482 440 439 435 434 417 414 409 404 401 213
3.7% -19.9% 48.4% 1.2% -19.9% 93.4% -21.7% 28.5% 46.7% 7.0% -4.7%
-18.4% -24.5% 50.6% -6.0% -28.6% 59.7% -32.5% 14.1% 19.2% -9.0% -11.8%
8-quarter Trend
Table 3: MSAs with the Highest Property Valuation Fraud Risk
Mortgage Fraud Risk Report
Q1 2012
7
IDENTITY FRAUD RISK INDEX
Identity fraud is frequently used in mortgage fraud schemes in order to hide the identity of the perpetrators and/or to obtain a credit profile that will meet lender guidelines. Table 4 displays the top 10 MSAs for identity fraud risk. San Jose, California takes over the top spot from Miami, Florida, which, with a 22 percent decrease in its index, moved down to fifth place. Two other California MSAs (Vallejo and Los Angeles) and one other Florida MSA (Naples) also make the top 10. Detroit is in second place, with another Michigan MSA – Ann Arbor – in fourth. The Tri-State area also accounts for two metros: Trenton, New Jersey and New York City. The list is rounded out by Tulsa, Oklahoma, which comes in fourth on the strength of its 164 percent increase from Q4 2011 value. The trend in the right-most column shows that the quarter-on-quarter and year-on-year increases of over 100 percent return Tulsa’s index to levels not seen in two years. The national value declined two percent from Q4 2011 and by 22 percent from one year ago, continuing the downward trend observed over the past five quarters.
Rank
1 2 3 4 5 6 7 8 9 10
Identity Fraud Risk Index Q1 2012
Metropolitan Statistical Area
San Jose-Sunnyvale-Santa Clara, CA Metro Detroit-Warren-Livonia, MI Metro Tulsa, OK Metro Ann Arbor, MI Metro Miami-Fort Lauderdale-Pompano Beach, FL Metro Vallejo-Fairfield, CA Metro Trenton-Ewing, NJ Metro Naples-Marco Island, FL Metro New York et al, NY-NJ-PA Metro Los Angeles-Long Beach-Santa Ana, CA Metro UNITED STATES
293 281 276 271 267 258 254 244 240 225 140
% Change since Q1 2011
% Change since Q4 2011
18.3% 7.6% 122.0% 21.6% -15.0% 62.7% -11.6% 169.0% -7.8% -5.4% -22.4%
-7.2% -3.2% 163.6% 27.2% -21.5% 66.1% 47.7% -6.9% -4.9% 1.8% -2.2%
8-quarter Trend
Table 4: MSAs with the Highest Identity Fraud Risk
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Q1 2012
8
OCCUPANCY FRAUD RISK INDEX
Occupancy Fraud is perpetrated by investors who falsely claim the intent to occupy the purchased property so as to obtain a mortgage with lower down payments and/or interest rates. Table 5 shows the 10 MSAs with the highest Occupancy Fraud Risk. Of these, only three –Miami in 1st, Modesto in 4th, and Detroit in 6th– return from the previous quarter. Miami is rated as the riskiest, moving up from 2nd place last quarter. The remainder of the list is geographically distributed throughout the United States with no clear concentration. The inclusion of Tulsa, Oklahoma, making its second appearance on a top 10 list this quarter, is notable because it has not previously appeared in any Mortgage Fraud Risk reports. Many of these metros make an appearance following double digit gains, including Jacksonville, North Carolina; Cleveland, Ohio; Killeen, Texas; Milwaukee, Wisconsin; and the aforementioned Tulsa. The national value is up two percent from the last quarter, but sharp decreases over previous quarters leave it 23 percent lower than one year ago. Rank
1 2 3 4 5 6 7 8 9 10
Occupancy Fraud Risk Index Q1 2012
Metropolitan Statistical Area
Miami-Fort Lauderdale-Pompano Beach, FL Metro Jacksonville, NC Metro Flint, MI Metro Modesto, CA Metro Cleveland-Elyria-Mentor, OH Metro Detroit-Warren-Livonia, MI Metro Kileen-Temple-Fort Hood, TX Metro Vallejo-Fairfield, CA Metro Milwaukee-Waukesha-West Allis, WI Metro Tulsa, OK Metro UNITED STATES
104 102 98 97 97 97 97 92 90 89 61
% Change since Q1 2011
% Change since Q4 2011
-26.0% 87.3% -20.1% -26.8% 9.1% -30.8% 35.8% -1.8% 50.3% 48.6% -23.2%
-23.6% 29.6% -12.2% -7.9% 30.3% -8.1% 26.5% -4.2% 73.5% 48.6% 2.1%
8-quarter Trend
Table 5: MSAs with the Highest Occupancy Fraud Risk
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Q1 2012
9
EMPLOYMENT/INCOME FRAUD RISK INDEX
Employment/Income Fraud occurs when an applicant’s income is misrepresented in order to meet lender underwriting guidelines for a loan. Table 6 displays the top 10 MSAs for employment/income fraud risk. California is the clear leader, laying claim to eight of these 10 metros, up from five last quarter. That said, Burlington, Vermont –a repeat from last quarter– comes in first by a margin of 80 points. Bridgeport, Connecticut rounds out the list. All of these metros experienced increases to their index values, and for the most part these gains were significant. The increase in the national value –nearly 5 percent on the quarter, 18 percent on the year and 37 percent over two years– is further evidence of the noteworthy growth of employment/income fraud risk.
Rank
Metropolitan Statistical Area
Employment/Income Fraud Risk Index Q1 2012
% Change since Q1 2011
% Change since Q4 2011
1 2 3 4 5 6 7 8 9 10
Burlington-South Burlington, VT Metro San Diego-Carlsbad-San Marcos, CA Metro Modesto, CA Metro San Jose-Sunnyvale-Santa Clara, CA Metro Bridgeport-Stamford-Norwalk, CT Metro Los Angeles-Long Beach-Santa Ana, CA Metro Oxnard-Thousand Oaks-Ventura, CA Metro San Francisco-Oakland-Fremont, CA Metro Vallejo-Fairfield, CA Metro Chico, CA Metro UNITED STATES
271 191 188 188 184 180 180 178 178 178 121
8.8% 23.3% 8.5% 15.4% 10.5% 11.7% 33.1% 21.1% 67.2% 35.8% 18.1%
6.2% 24.5% 23.8% 19.6% 26.7% 15.1% 44.6% 3.7% 12.4% 39.7% 4.5%
8-quarter Trend
Table 6: MSAs with the Highest Employment/Income Fraud Risk
Mortgage Fraud Risk Report
Q1 2012
10
Increase in Refinance Applications Figure 3 shows that over the last two years there has been a close correlation between the proportion of refinancing applications in the FraudGUARD®system and the prevailing mortgage rates. Reflecting national trends, low mortgage rates resulted in increased levels of refinances relative to purchases. Therefore, as already low rates dropped to increasingly record lows over the last year, a surge in refinancing activity caused a distinct change in the composition of loan applications in the FraudGUARD system, from a nearly 60:40 split between purchases and refinances in Q2 2011 to a 40:60 split in the current quarter. This section examines the implications of this change in composition.
6.0
100%
5.5
30-Year Fixed-Rate
80% 70%
5.0
60% 4.5
50% 40%
4.0
30% 20%
3.5
10% 3.0 Q1 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
0% Q1 2010
30-Year Fixed-Rate, Percentage
90%
Proportion of Loan Applications that are for Refinances, Percentage
Percent of Loan Applications that are for Refinances
Composition of Loans by Purpose, Q2 2011 to Q1 2012 Percentage of Loan Applications
100% 90%
Purchases
80% 70% 60% 50%
Refinances
40% 30% 20% 10%
All Else
0%
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Figure 3: Mortgage Rates and Proportion of Refinancing Application, Q1 2010 to Q1 2012
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Q1 2012
11
Table 7 shows the top 10 riskiest states in terms of refinances and purchases for the current quarter. There are a number of differences between the two lists that suggest that some of the major geographical trends that have been seen over the last year have been at least partially due to the change in composition of the loans. The clearest example is in the Tri-State area where fraud risk in repurchases is much higher than in purchases. New Jersey (4th), New York (9th) and Connecticut (10th) all feature in the top 10 for refinances, while only New Jersey (7th) makes the top 10 in the purchases table. As refinancing activity surpassed purchases, the risk in the Tri-State area relative to the rest of the nation increased as well.
Rank
State
Mortgage Fraud Risk Index Q1 2012 for Refinances
Rank
State
Mortgage Fraud Risk Index Q1 2012 for Purchases
1
Nevada
261
1
Arizona
215
2
Arizona
209
2
Florida
203
3
Florida
202
3
Nevada
203
4
New Jersey
190
4
California
185
5
California
165
5
Georgia
173
6
Georgia
161
6
Colorado
169
7
Ohio
158
7
New Jersey
165
8
Michigan
155
8
Michigan
160
9
New York
153
9
Maryland
155
10
Connecticut
151
10
Tennessee
150
Table 7: States with Highest Mortgage Fraud Risk for Refinances and Purchases
Mortgage Fraud Risk Report
Q1 2012
12
Table 8 shows the type-specific fraud risk indices segregated by refinances and purchases, as well as the percent change in the overall index values over the last four quarters. The most significant trends are in the Identity and Occupancy Fraud Risk Indices, which have seen decreases of 22 and 23 percent respectively, and the Employment/Income Fraud Risk Index, which saw an increase of 18 percent. Both indices that decreased have lower index values for refinances relative to purchases, while the reverse is true for the Employment/Income Index. This suggests that at least part of the major type-specific trends over the last four quarters is due to the change in loan composition.
Fraud Risk Index
Refinances Q1 2012
Purchases Q1 2012
Percent Change Q1 2011 to Q1 2012
-3.1%
Mortgage Fraud Risk Index
136
142
Property Valuation Fraud Risk Index
214
205
-4.7%
Identity Fraud Risk Index
123
169
-22.4%
Occupancy Fraud Risk Index
42
90
-23.2%
Employment/Income Fraud Risk Index
130
103
18.1%
Table 8: States with Highest Mortgage Fraud Risk for Refinances and Purchases
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Q1 2012
13
Extended Forecast The Interthinx Fraud Risk Indices have proven to be a leading indicator of default and foreclosure activity. Therefore, the regions that currently have high Fraud Risk Indices are likely to continue to experience high foreclosure rates going forward. Based on the Fraud Risk Indices, regions that bear close scrutiny going forward include: • Nevada and Arizona, which continue to be the two riskiest states. • Florida, which contained the two riskiest MSAs (Cape Coral and Miami), contained half of the top 10 riskiest ZIP codes, and was well-represented in the Property Valuation, Identity, and Occupancy top 10 lists. • The New York Tri-State area, where fraud risk continued to rise with all three states – New Jersey, Connecticut and New York– making the top 10 in 4th, 8th and 10th places, respectively. In addition, the two riskiest ZIP codes were located in the Tri-State area. • California, which, despite a significant decline in risk this quarter, is still the 5th riskiest state, contains five of the 10 MSAs with the highest fraud risk, and eight of the 10 MSAs with the highest employment/income fraud risk.
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Q1 2012
14
About the Interthinx Fraud Risk Indices The Fraud Risk Indices are calculated based on the frequency with which indicators of fraudulent activity are detected in mortgage applications processed by the Interthinx FraudGUARD®system, a leading loan-level fraud detection tool available to lenders and investors. The Interthinx Fraud Risk Indices consist of the Mortgage Fraud Risk Index, which measures the overall risk of mortgage fraud, and the Property Valuation, Identity, Occupancy and Employment/Income Indices, which measure the risk of these specific types of fraudulent activity. The Mortgage Fraud Risk Index considers 40+ indicators of fraudulent activity including property mis-valuation; identity, occupancy and employment/income misrepresentation; non arms-length transactions; property flipping; straw-buyers; “silent seconds”; and concurrent closing schemes. The four type-specific indices are based on the subset of indicators that are relevant to each type of fraudulent activity. Each Index is calibrated so that a value of 100 represents a nominal level of fraud risk, a value calculated from the occurrence of fraudulent indicators between 2003 and 2007 in states with low foreclosure levels. For all five indices, a high value indicates an elevated risk of mortgage fraud and each Index is linear to simplify comparison across time and location. The Interthinx Indices are leading indicators based predominantly on the analysis of current loan originations. FBI and FinCEN reports are lagging indicators because they are derived primarily from Suspicious Activity Reports (SARs), the majority of which are filed after the loans have closed. The time lag between origination and the SAR report can be several years. For this reason, the Interthinx Fraud Risk Indices’ top geographies and type-specific findings may differ from FBI and FinCEN fraud reports.
Mortgage Fraud Risk Report
Q1 2012
15
About the Interthinx Mortgage Fraud Risk Report The Interthinx Fraud Risk Report represents an in-depth analysis of residential mortgage fraud risk throughout the United States as indicated by the Interthinx Fraud Risk Indices. Published quarterly, as part of the Fraud Risk Report, Interthinx will report on the geographic regions with the highest Mortgage Fraud Risk Index as well as those with the highest Property Valuation, Identity, Occupancy, and Employment/Income Fraud Risk Indices. The Interthinx Fraud Risk Indices track these risks in all States, Metropolitan areas, Counties and county equivalents, throughout the United States.
About Interthinx Interthinx, a Verisk Analytics subsidiary, is a leading national provider of comprehensive risk mitigation solutions focusing on mortgage fraud, collateral risk and valuation, regulatory compliance, forensic loan audit services, loss mitigation, and loss forecasting. With more than 20 years of experience in customizable risk evaluation technology, Interthinx offers proven and effective predictive analytics to the residential mortgage industry through its experience with millions of loan applications and fraud incident data from thousands of monthly loan reviews. Throughout the mortgage life cycle, the Interthinx suite of services can increase the value of client portfolios with its comprehensive and holistic approach to loan quality and compliance. Winner of multiple awards for technology, Interthinx helps clients reduce risk, increase operational efficiencies, satisfy regulator demands, manage data verification, remain compliant and mitigate loan buybacks. The Interthinx quarterly Mortgage Fraud Risk Report is a standard for the financial services industry. For more information, visit interthinx.com or call 1-800-333-4510. MEDIA CONTACT: Rick Grant Telephone: 800-979-9049 Cell: 570-497-1026 Email: [email protected]
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Q1 2012
16
