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The fraud file.

Interthinx's Top 10 Hot Spots for possible mortgage fraud are derived from an analysis of all loan application data submitted to the Interthinx fraud-detection tools in the second quarter of 2009. Of all the loans submitted to Interthinx for evaluation in the second quarter of 2009, 25.77 percent received a "critical risk" loan status rating and had at least one high-impact variance in one of the following categories: employment/income; identity; occupancy; straw buyer; property valuation; or property flipping.
(For states with more than 2,000 total submissions for the quarter)

State Loans with Variances Employment/Income Identity Occupancy

NV 46.42% 3.40% 14.62% 4.11%

AZ 36.72% 4.64% 8.32% 3.73%

CA 35.14% 4.99% 9.44% 3.60%

MI 33.83% 5.56% 9.10% 4.94%

FL 32.16% 4.64% 7.66% 3.75%

CO 32.03% 5.29% 11.71% 4.90%

OH 28.36% 4.39% 8.08% 2.70%

MD 27.07% 4.07% 7.96% 2.80%

NJ 26.14% 4.98% 9.99% 3.78%

NY 26.07% 4.45% 9.11% 3.18%

State Straw Buyer * Property Valuation Property Flipping

NV 0.45% 33.36% 0.43%

AZ 0.38% 25.75% 0.27%

CA 0.61% 23.46% 0.18%

MI 1.25% 21.34% 0.10%

FL 0.43% 21.81% 0.42%

CO 1.99% 17.94% 0.21%

OH 0.13% 18.01% 0.20%

MD 0.14% 17.19% 0.12%

NJ 0.36% 13.12% 0.16%

NY 0.27% 14.53% 0.16%

SOURCE: Interthinx

* The Interthinx[TM] "straw buyer" flag identifies a subject property
that has been entered into Interthinx's system multiple times by
different individuals, based on input Social Security numbers.

The highest possible fraud rates were found in the 10 states identified in the table above (all were states where at least 2,000 loans were submitted). "Inflated property value" was identified as the most common fraud category and was found in 56.77 percent of all "critical-risk" loan files submitted in the second quarter of 2009. In descending order, the following states rated highest in this category based on the number of critical-risk loan files submitted: Nevada, Arizona, Florida, California, Massachusetts, Ohio, Maryland, Michigan, Minnesota and Pennsylvania.

None of the results contained above reflect either civil or criminal cases of fraud proven in a court of law. The results are derived from data provided by Interthinx clients, internal and external Interthinx data sources. Interthinx product-scoring results and human decision-making logic. The results reflect a significant variance between borrower-provided data and the other data sources generally set forth above, and are indicative of a greater potential for misrepresentation. These data differ from FBI statistics. The Interthinx data include loan application information on loan files in process during the second quarter of 2009. before a lending decision was made. FBI statistics are based predominately on Suspicious Activity Reports (SARs) filed by lenders associated with banking entities. which may include closed loans and loans originated in prior years.
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Publication:Mortgage Banking
Geographic Code:1USA
Date:Aug 1, 2009
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