Mortgage application fraud is down according to a new report from First American Financial Corp. The company has released statistics cited from its own loan application department that show positive signs for the future.
"For April, the First American Loan Application Defect Index was 82, unchanged from March, but up from 81 in April 2017," according to National Mortgage News.
"However, the index is down 19.6% from October 2013, when it was at 102, before the ATR rules went into effect in January 2014. The index measures the frequency of defects, fraud and misrepresentations in mortgage applications."
First American's Chief Economist Mark Fleming believes that the "ability-to-repay rules" has been a major player in the "significant decline in income-specific mortgage loan application misrepresentation, defect and fraud risk," according to a press release cited in the NMN report.
An infographic from the report shows that April 2018 featured the second lowest level when it came to the risk of loan application defects in relation to income misrepresentations.
To learn more about the ability-to-repay rules and how it has contributed to the drop in loan application fraud, click on the image above.