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CoreLogic Launches Industry's First Short Sale Monitoring Solution to Prevent Fraud and Underpricing
Aug 30, 2010 (06:08 PM EDT)


-- New Service Allows Lenders Real-Time Access to Concurrent Transactions --

SANTA ANA, Calif., Aug. 30 /PRNewswire/ -- CoreLogic (NYSE: CLGX), a leading provider of consumer, financial and property information and business services, today announced the lending industry's first short-sale fraud prevention and pricing solution, Short Sale Monitoring Solution™. The new service allows lenders to receive alerts on "risky" pending and closed short sales to minimize unnecessary losses related to fraud and property underpricing, which CoreLogic estimates at $41,500 per transaction. Short Sale Monitoring Solution provides real-time access to lenders' concurrent transactions on short-sale properties through the CoreLogic Mortgage Fraud Consortium, the largest repository of application and transaction data, representing 65 percent of annual loan applications.

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"Short-sale fraud is costing lenders $310 million a year and those losses may increase if lenders cannot proactively identify risks in real time," stated Tim Grace, senior vice president of Fraud Analytics, CoreLogic. "Prior to our solution, lenders were disadvantaged by not being able to cross reference pending loan applications on the same property. Our Short Sale Monitoring Solution gives lenders unique and immediate pre- and postclosing perspectives on short-sale transactions."  

Freddie Mac reported that it has seen short-payoff volume grow more than 1,000 percent, and that the upward trend in volume leaves the short-sale market ripe for fraud. To prevent short-sale fraud preclosing, CoreLogic Short Sale Monitoring Solution matches details against other pending loan applications in the consortium database and public records for the same property. When a matching record is found, an alert goes instantly to the lender, recommending a decision to delay pending further investigation. The service also has the ability to identify the entity or entities perpetrating the potential fraud.

For short sales that have already closed, Short Sale Monitoring Solution continues to watch the property for a period specified by the lender. Any subsequent loan closed on the property generates an alert to the original short-sale lender and the resale lender, if different. Although too late to avoid the original sale, the postclosing alert notifies the first lender to review sale terms for violations. It also alerts the new lender that it could be party to fraud discovered in the dual transactions.

Another benefit Short Sale Monitoring Solution offers lenders is preventing missed-opportunity losses. Pricing properties excessively below market value allows savvy investors to resell for a sizeable profit, claiming money lenders may have inadvertently left on the table. Short Sale Monitoring Solution watches for and evaluates short-sale resales for 90 days, enabling lenders to refine pricing methods on an ongoing basis. Another option available is a retrospective short-sale analysis that allows lenders to detect fraud, assess pricing-method accuracy and pinpoint problematic geographies. Isolating and analyzing these issues enables lenders to avert future losses.

CoreLogic defines short sales as risky when either the second sale amount is vastly higher than the initial short sale and/or the second sale transaction happens too soon after the first. In its recently released research study, "The Cost of Short Sales," CoreLogic estimates that short-sale volume has increased to 400,000 transactions per year and provides sample scenarios of short-sale fraud schemes. More information about Short Sale Monitoring Solution can be found at http://www.corelogic.com/Products/Short-Sale-Monitoring-Solution.aspx.

About CoreLogic

CoreLogic is a leading provider of consumer, financial and property information, analytics and services to business and government. The company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services that bring dynamic insight and transparency to the markets it serves. CoreLogic has built the largest and most comprehensive U.S. real estate, mortgage application, fraud, and loan performance databases and is a recognized leading provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. More than one million users rely on CoreLogic to assess risk, support underwriting, investment and marketing decisions, prevent fraud, and improve business performance in their daily operations.  Formerly, the information solutions group of The First American Corporation, CoreLogic began trading under the ticker CLGX on the NYSE on June 2, 2010. The company, headquartered in Santa Ana, Calif., has more than 10,000 employees globally with 2009 revenues of $2 billion. For more information visit www.corelogic.com.

Short Sale Monitoring Solution and CoreLogic are registered trademarks of CoreLogic, Inc.

SOURCE CoreLogic