It often seems that mortgage fraud is just like the weather – everyone talks about it, but no one seems to be able to fix it. This week, we explore the thorny subject of mortgage fraud with a leading expert on the topic: Brent Chandler, founder and CEO of Athens, Ga.-based FormFree Holdings Corp.
Q: In your opinion, how successfully is the industry addressing fraud prevention today? And are there areas where improvement is needed?
Brent Chandler:The industry is very aware of fraud and is working actively to remove it, but there is always room for improvement. Any part of the loan application process that still relies on the exchange of paper and manual processes is at the highest risk for tampering and the falsification of data. Thankfully, technologies have been emerging to automate a lot of the data collection. To the extent that you can remove people and paper from the lending process, you can mitigate fraud.
Q: What do you see as the most common fraud schemes going on today?
Brent Chandler: We still see a lot of origination fraud being perpetrated by borrowers. Lenders tell us that they receive between three to five fake bank statements on applications a day, and those are only the ones that they catch. The actual number could be much higher on applications in which the borrower’s income, assets and employment are being verified through paper manual processes.
To view the entire Executive Spotlight, please see “Executive Spotlight: Brent Chandler”