Friday
November 21, 2014

5 States With the Most Mortgage Fraud

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5 States With the Most Mortgage Fraud

Mortgage fraud continues to climb in the country as $1.3 billion in questionable loans surfaced in the third quarter, according to a mortgage fraud index by Mortgage Daily. 

Florida continues to have the most cases of mortgage fraud, according to the index. In Florida alone, mortgage fraud activity included more than $144 million in loans that were questioned in court, and Florida’s mortgage fraud index soared 45 percent in the third quarter compared to the previous quarter.

The five states that had the worst index ranking with mortgage fraud cases, according to Mortgage Daily, are: 

  1. Florida
  2. California
  3. Minnesota
  4. New York
  5. Texas

A big bulk of the mortgage fraud cases stem from 2008, in which investors pressured banks to purchase back many mortgages that did not meet underwriting standards or contained false information, such as misstating the borrower’s income, Sam Garcia, founder and publisher of Mortgage Daily, told The Palm Beach Post

"For a long time there just wasn't much prosecution," Garcia said. "Then we were just inundated. People who had committed fraud could no longer cover it up when the market turned bad and it became clear that loans were made that shouldn't have been made."

Source: “Florida Leads Country in Mortgage Fraud Cases,” The Palm Beach Post (Dec. 14, 2011)

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