A California risk management services provider claims a new automated online service reduces fraud from fake income verifications.
As housing prices continue to outpace household earnings, borrowers are more likely to exaggerate their income to qualify for an adequate mortgage and add to lenders’ discouragement of originating non-verified and stated income loans.
A new tool from ComplianceEase, dubbed 4506Xpress, efficiently detects fraudulently stated borrower income, according to an announcement Wednesday. The company says the service helps maintain compliance with secondary mortgage market investor requirements while streamlining quality control procedures associated with reducing mortgage application fraud.
“The prevalence of income exaggeration in the marketplace requires mortgage originators to quickly and accurately verify the borrower’s income through government records,” company vice president David Girling said in the announcement. “By delivering electronic transactions and web-based file management to the income verification process, 4506Xpress helps lenders accelerate loan closing and reduce overall costs and risk.”
The tool’s tax filing verification enables lenders to confirm the filing status of tax returns associated with stated income and no income verification mortgage applications, the San Francisco based division of LogicEase Solutions Inc. said. Meanwhile, the electronic file management system eliminates the need to maintain paper tax transcripts and income verification reports.
As for the secondary mortgage market, where nearly all loan purchasers require proof of income verification for full-doc and stated-income loans, the web-based, loan file management tools can help lenders more easily manage large volumes of mortgage data, collaborate with colleagues, reduce operational costs and improve efficiency, ComplianceEase said.
