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Mortgage fraud predicted to rise in 2013

5th December 2012

Experian predicts there will be an increase in attempted mortgage fraud in the UK next year, bringing the number of people fraudulently trying to obtain home loans to the highest level since records began in 2009.

Experian, a credit reference agency has warned that cases of mortgage fraud are expected to surge next year as more people attempt to misrepresent their finances or hide adverse credit histories.

A total of 43 out of every 10,000 mortgage applications are expected to be identified as fraudulent in 2013 – marking a rise of 13% on 2012 figures and 26% on 2011.

Nick Mothershaw, Director of Identity & Fraud Services at Experian in the UK and Ireland, said: “Almost 90 per cent of mortgage fraud tends to originate from genuine individuals misrepresenting their financial situations attempting to buy property that would ordinarily be out of reach. With tougher rules on UK mortgage lending set to come into force in 2014, where lenders will have to put a borrower’s ability to repay under greater scrutiny, it important that they have the correct tools in place to do this, especially as attempted fraud in this industry is set to increase significantly over the next 12 months. 

“Increased fraud levels in specific industries mean that it has never been more important to ensure that applications for new credit facilities are analysed for signs of fraudulent activity. Simple steps organisations can take to mitigate risk include robust checking of new applications for credit using tools that reveal first party fraud and organised fraud rings, continually reassessing fraud risk across existing accounts and introducing true identity authentication using facts only a genuine applicant will know on all products, not just the higher risk ones.”

Read more about the scam on the Experian website. 

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