| Quality Control,
Fraud Detection and Prevention Mortgage fraud is serious
business. Every staff member at Novation Mortgage is required to
maintain continuing education in Mortgage Fraud Detection and
Prevention. Every member recently passed the Interthinx FSI Exam
as well as the REIUniversity.net Mortgage Fraud According to the
FBI course.
 All files underwritten by Novation Mortgage are passed through
rigid and stringent automated fraud detection systems as well as
numerous manual cross-checks and balances. Fraud detection is
based on following certain "Red Flags" and clearing each one
individually. The more complex the deal the more likely there are
to be red flags. When a red flag cannot be cleared the application
is denied and, if there is any suspicion of misrepresentation the
file is released to the proper authorities.
More often than not our Quality Control procedures provide a
safety net to our clients. One of the best protections our client
enjoys from our efforts is not purchasing a property which was
listed with a price over average market value.
If your file is denied because of too many red flags it wasn't
a good deal anyway. As we tell all of our regular investment
clients our efforts don't only protect us from misrepresentations,
they protect you from misrepresentations, over-valued properties
and bad deals.
Here are some of the things that are on the top of the lender's
(and FBI's) hit list and cause "Red Flags":
* Commissions paid to unlicensed third parties in any manner -
especially looking for unrecorded liens, payouts to LLC's instead
of the seller's name, falsified repair bills paid at closing
* Value increase of more than 10% per year from last sales price
without documented repair/upgrade costs
* Property in any neighborhood (value zone) being more than 5% per
square foot higher
* Omission (intentional or unintentional) of closer recent sales
than chosen comps on URAR
* Seller's name at closing not matching seller's name on security
deed
* (Believe it or not) Sales of unlisted properties can cause a Red
Flag (FSBO's included)
* Builder bailouts - sales of uncompleted new construction for
below market value sold as completed instead of "subject to
completion/repairs"
* Investment property purchased as owner occupied property -
believe it or not this is still a huge problem even after so many
people have gone down for this
Contact one of our seasoned
professionals for more information.
* Although we provide tools for your information on this
website you can never accurately plan your transaction without the
assistance of a seasoned Loan Professional. Also, just because
there is "a" payment listed it does not necessarily mean that it
is "your" payment. Yours may be higher or yours may be lower. Do
not assume that, even though the information in these tools is
mathematically accurate that they are accurate to your specific
scenario.
CAUTION: Although the
math here is accurate it is vital that you speak with a
funding specialist who understands all of the nuances and
options relative to specific deals. It may be possible that
there is another solution more suited to your specific needs
and the transaction you are researching.
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