Make us your home page

Florida No. 2 in mortgage fraud, Mortgage Asset Research Institute survey finds

Three years after the housing boom turned to housing bust, Florida still churns out fraudulent home loans at nearly three times the rate of the national average.

Though we're no longer tops nationally for tainted mortgages — that dubious honor now belongs to Rhode Island — borrowers continue to put one over on lenders.

Crooks' access to slicker technology, including computer programs that forge tax forms and pay stubs, have kept mortgage lenders on their toes.

And a larger chunk of the crooked activity involves foreclosure rescue scams, said Denise James, who helped conduct the 2008 state-by-state survey for the Mortgage Asset Research Institute.

"If in the past it was a crime of opportunity, now it's generally being committed as a crime of desperation," James said.

In Florida, the Tampa Bay area trailed Miami in its rate of fraud. In Miami, the most common trick was listing incorrect assets on a mortgage application, a reflection of that market's higher housing prices. Tampa fraudsters typically worked with inflated housing appraisals to flip a property for fast cash.

The overall national survey showed a 26 percent rise in fraud and misrepresentation from 2007 to 2008. The research institute, whose subscribers represent about 70 percent of loan originators in the United States, said the results don't prove fraud is exploding. Loan originations are a trickle of what they were in 2005. Greater vigilance on the part of lenders burned in the mortgage meltdown accounts for the much of the rising case volume.

"Fraud for housing" — people misrepresenting facts on their application to buy a private residence — makes up about 80 percent of the cases. "Fraud for profit," often a criminal collaboration involving straw buyers, makes up the remaining 20 percent. But the profiteers wreak most of the financial devastation estimated at $15 billion to $25 billion in 2008.

The Mortgage Bankers Association is pushing to simplify loans and trim excess paperwork on the theory that criminals thrive in the profusion of documents.

"Fraud always enjoys confusion," said John Courson, the association's chief executive.

Less bad in 2008

Florida's rate of mortgage fraud receded slightly in 2008 after several years of growth.

2008: 2.79 times the national average.

2007: 3.12 times the national average.

2006: 2.1 times the national average

2005: 1.77 times the national average

2004: 1.76 times the national average.

Top states

Top 10 top states for mortgage fraud in 2008

1. Rhode Island

2. Florida

3. Illinois

4. Georgia

5. Maryland

6. New York

7. Michigan

8. California

9. Missouri

10. Colorado

Florida No. 2 in mortgage fraud, Mortgage Asset Research Institute survey finds 03/16/09 [Last modified: Monday, March 16, 2009 10:47pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. Irish 31 brings flair, flavor to Wiregrass


    WESLEY CHAPEL — Irish 31 Pub House & Eatery opened its fifth location at The Shops at Wiregrass earlier this month.

    hillsevbiz072117: Irish 31 has opened at the Shops at Wiregrass with a warm, wood decor. Photo courtesy of Irish 31.
  2. Family fun featured at Lutz-area ice cream shop


    LUTZ — For Joe Schembri, ice cream reminds him of fun times he spent with his family as a child.

    hillsevbiz072117: Joe Schembri has opened the Ice Dreamery in Lutz. Photo courtesy of Joe Schembri.
  3. Clean Eatz offers low-cal options in South Tampa


    Inside Clean Eatz, almost everything is under 500 calories.

    Clean Eatz will offer healthy dining options in South Tampa. Photo courtesy of Clean Eatz.
  4. Salon brings a Parisian experience to Tampa


    A new salon in International Plaza, opened by French women Geraldine Jousseau and Estelle Mattingly, takes clients on a trip to Paris.

    Le Studio Paris offers a variety of salon services in International Plaza. Photo courtesy of Le Studio Paris.
  5. Ratings service Nielsen begins tracking live TV consumption on Hulu, YouTube


    TV ratings service Nielsen will begin tracking how many people watch network TV on YouTube and Hulu to gauge how many viewers broadcast networks have through streaming, the company announced Tuesday.

    Nielsen, a ratings company, is monitoring how many viewers watch live TV on Hulu and YouTube to get a better sense of overall viewership. | [AP]