MORTGAGE FRAUD ON THE RISE

A new report from Equifax Canada says high-risk and suspected fraudulent mortgage activity is on the rise, citing a 52 per cent increase in suspected fraudulent mortgage applications since 2013.

A recent Equifax survey showed:

• 13 per cent of Canadians indicated they felt it was okay to tell “a little white lie” when applying for a mortgage to get the house they want.
• 16 per cent said they believe mortgage fraud is a victimless crime.
• Eight per cent admitted to misrepresenting the facts on a credit or loan application.

“We’re certainly seeing more mortgage applications being flagged as suspicious by our reporting institutions,” says Tara Zecevic, vice president, customer insight at Equifax Canada. “While we cannot entirely attribute these increases to consumers overstating personal income or falsifying applications, we do want to remind people that there are serious consequences for making false or inaccurate claims on any loan or mortgage applications. Not only will it stretch your finances, it is in breach of your contractual obligations with the lender, and simply put, it’s against the law.”

When asked about who they trust in the home-buying experience:

• 44 per cent of Canadians trust real estate agents the least during the home-buying experience.
• About one-in-four also distrust homeowners (27 per cent) and home inspectors (26 per cent).
• 20 per cent distrust mortgage brokers, another 16 per cent don’t trust their bank and equally 16 per cent have little trust in their insurance agent.
• Only nine per cent said they trust all professionals involved in the home-buying experience.

When asked about housing prices:

• 84 per cent believe that the cost of home ownership is too high for first-home buyers today.
• Nearly three-in-10 Canadians cite “more demand than supply” (29 per cent) and “foreign buyers” (27 per cent) as the main factors driving up home prices.
• B.C. residents (compared to other provinces) were significantly more likely to cite foreign buyers as the top reason for home prices being driven up (75 per cent versus 42 per cent for all other provinces).

The survey was conducted online capturing a representative sample of 1,547 Canadians from across the country. A sample of this size would yield a margin of error of +/- 2.5% 19 times out of 20, says the company.

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