Mortgage Verification Scheme launched.

FraudBuster

Following a successful pilot, 1 September sees the formal launch of an important new scheme to combat mortgage application fraud.
HM Revenue & Customs, the Council of Mortgage Lenders and the Building Societies Association have worked together on the development of the Mortgage Verification Scheme and see it as an important additional tool to help beat fraud. The National Fraud Authority estimates the cost of mortgage fraud at £1 billion last year, so measures to tackle it are important.
The scheme was announced in the March 2010 budget and has been refined during the pilot period since. Use of the scheme will be limited to cases where lenders reasonably suspect, following their own rigorous checks, that mortgage fraud may be taking place.

Continued:


http://www.cml.org.uk/cml/media/press/3039

DannyboyMidlands

Apparently they're not just checking for mortgage fraud but also for tax evasion. If you are self employed and claim higher earnings on your mortgage app than your tax return, HMRC will be in touch.

Senior_Paper_Monitor

:undecided Indeed - the sceptical amongst us might suggest that is the main purpose !

freddieD

There is one thing I don't understand about this policy: how do mortgage lenders lose £1 billion per year? if somebody says he earns more than he does, gets the mortgage and then cannot pay it, the mortgage company will simply take the property back, sell it and get their money back.

And yes, this scheme is for the benefit of the tax office (they have yet another method of snooping around) not for the benefit of the mortgage companies.