One leading title insurer is noticing more cases of insurance fraud and a change in focus on the value of mortgages fraudsters are targeting.
“In 2009 we were flagging suspicious residential frauds about once a week. That average has increased to almost twice a week five years later,” Eric Haslett, vice-president & chief underwriter for FCT said in an official release. “The value of these transactions is dropping as well. I think fraudsters may be trying to slip smaller transactions by us as they may believe that a higher value mortgage may be subject to greater scrutiny.”
The company is noticing an increase in lower mortgages being flagged.
“In 2008, the amount of mortgage funding sought in a flagged residential transaction was $600,000 on average." an official release from FCT states. "By 2013 the average has dropped to $360,000 - a 40% drop in mortgage money.”
Fraud cases are suspected in less than one per cent of the company’s underwritten business. Still, FCT has intimated a devotion to constantly moniter its processes to ensure the lowest possible amount of fraud cases.
“While transactions where real estate fraud is suspected by our underwriters still constitutes less than one percent of our overall business, we want buyers, lenders and their legal counsel to know that when it comes to their deals we are just as vigilant on every transaction no matter the price point or mortgage value,” Haslett said. “We constantly monitor trends and update our underwriting processes with a view to protect their interests.”
Kevin Benta is a sales representative with Century 21 Percy Fulton and serves Toronto, Pickering, Ajax, Whitby and Oshawa.