This City Has the Most Risk of Mortgage Fraud

Housing

Published: February 16, 2022 7:30 am

Home values have soared over the past year. In many markets, home prices have risen by double-digit percentages. The widely followed S&P Case-Shiller real estate index, which measures home prices in major metropolitan areas nationwide, showed those prices hit a record high annual gain of 19.1% in October.

Several factors drove the rise in home prices. Among them are some of the lowest mortgage rates in decades, although that has started to change recently. People also want to move from very large and expensive cities, many of which are on the coasts and include New York and San Francisco. Also, the ability to work from home because of the COVID-19 pandemic has freed up millions of people to move.

Home price increases have been driven by people leaving the largest cities because of the pandemic. Other drivers include solid middle- and upper-class incomes and low mortgage rates. The value of home equity for the average homeowner nationwide rose by $51,500 in the second quarter of 2021, compared with the same period a year ago. Nationwide, home equity rose 29.3%, or nearly $2.9 trillion, according to CoreLogic. The state where home equity rose the most was California.

The jump in relocations and home prices also has increased the odds of mortgage fraud. CoreLogic’s new “Mortgage Fraud Brief Quarterly Mortgage Fraud Insights” report covers the fourth quarter of 2021. Its National Mortgage Application Fraud Risk Index is “calculated from the aggregation of individual loan application fraud risk scores during the previous quarter.” The study examines the 100 highest-populated core-based statistical areas.

The mortgage fraud risk index score of 125 for the third quarter rose 10.4% to 138 in the fourth quarter. The city with the highest fraud risk in the fourth quarter was Las Vegas, with a figure of 240.

These are the 15 cities with the most fraud risk:

Las Vegas, Nev. (240)
Poughkeepsie, N.Y. (227)
San Jose, Calif. (219)
Miami, Fla. (218)
Los Angeles, Calif. (205)
New York, N.Y. (198)
McAllen, Texas (192)
San Francisco, Calif. (185)
New Orleans, La. (182)
San Diego, Calif. (179)
Austin, Texas (171)
Tampa, Fla. (170)
Orlando, Fla. (169)
Stockton, Calif. (169)
New Haven, Conn. (167)

Click here to see the state where people are getting rich on their homes.

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