What surprises me is the apathetic way some lenders have approached the problem of fraud, especially when it can have such a dramatically negative effect on their business.
At Tiuta we cross-check all valuations and where we find discrepancies, use internal surveyors. With automated valuation models now covering most residential properties, cross-checking is simple.
We do not add on cost for this service and if we did, it would be minimal.
I suspect most brokers would rather have had £10 or so added to the cost of mortgages and there still be access to abundant credit rather than the current situation whereby lenders are unsure of the value of their portfolios and so are unwilling to lend.
While watching out for fraud is in every lender’s training manual, more scrutiny needs to be applied to applications that don’t add up.
This means investing in education for staff and more thorough checks to ensure fraudsters don’t slip through the net.
Lenders’ complacency regarding potential fraud has contributed to the mess the market is in today. They must now ensure they have the appropriate checks and balances in place to prevent fraud.