11 Ways to Avoid Mortgage Fraud


With today’s technology, it’s getting easier and easier to gather people’s personal information illegally, not to mention falsify documents and other information. Unfortunately, some people are taking advantage of the ease of committing fraud, and despite the fact that there is no specific organization that collects statistics on how much money actually passes through the hands of fraudsters, there is speculation that it’s on the rise.

Mortgage fraud is defined as “the material misstatement, misrepresentation or omission relied upon by an underwriter or lender to fund, purchase or insure a mortgage loan” by the Canadian Association of Accredited Mortgage Professionals. Types of mortgage fraud include: over-evaluation of property value, forged or altered MLS listings, misrepresentation of a buyer’s intention to reside in a property, forged or altered employment letters, forged or altered identification and fraudulent title transfer/fraudulent mortgage discharge, among other things.

To read more about protecting yourself from mortgage fraud, please click the “read more” link below.

You must be diligent about protecting yourself from fraud. The Canadian Bankers Association says that you should do the following to prevent yourself from becoming a victim (you can read more here):

  • Do not give out personal information on the phone, through mail or over the Internet unless you have initiated the contact or know with whom you’re dealing.
  • If it sounds too good to be true, it probably is – before you reveal any personal information, find out how it will be used and if it will be shared.
  • Pay attention to your billing cycles. Follow up with creditors if your bills don’t arrive on time.
  • Guard your mail. Deposit outgoing mail in post office collection boxes or at your local post office. Promptly remove mail from your mailbox after delivery. Ensure mail is forwarded or re-routed if you move or change your mailing address.
  • Minimize the identification information and number of cards you carry.
  • Keep items with personal information in a safe place. An identity thief will pick through your garbage or recycling bins. Be sure to tear or shred receipts, copies of credit applications, insurance forms, physician statements and credit offers you get in the mail.
  • Give your Social Insurance Number (SIN) only when absolutely necessary. Ask to use other types of identification when possible. (Incidentally, mortgage lenders require SIN numbers to accurately verify your credit score and identify you)
  • Don’t carry your SIN card; leave it in a secure place.
  • Check your credit report regularly to ensure there are no discrepancies
  • Reviewing your credit report can help you find out if someone has opened unauthorized financial accounts in your name. There are three credit reporting agencies in Canada: Equifax Canada, Northern Credit Bureaus Inc. and TransUnion Canada. You can request free copies of your credit report from credit reporting agencies by mail. Online versions of reports are also available for a small fee.
  • You can also conduct a property search at your province land registry office to ensure that the title to your home is in your name.

Mortgage fraud is a crime. Be suspicious if you are approached about making quick, easy money through some real estate scheme, or if someone asks to use your name for credit purposes. Be sure to report your suspicions to the Real Estate Council of Alberta – they’re equipped to deal with suspected mortgage fraud and take the required action to penalize the party committing fraud.

Please remember that it’s not only possible for fraud to be committed in the mortgage industry – there is also debit and credit card fraud, email fraud/phishing and identity theft (this list is not exhaustive). So be aware and be careful!

First Foundation takes your privacy very seriously and is very careful to adhere to industry “Best Practices” for managing and securing your private information. You can read our Privacy Policy to learn more about how we work hard to protect you.

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