The Society of Mortgage Professionals (SMP) has urged brokers concerned that a customer is attempting to commit mortgage application fraud to under no circumstances submit the proposal to a lender.

The latest good practice guide from the SMP outlines the current methods of mortgage fraud and shares hints with brokers on how to spot and prevent this form of criminal deception.

The guide explains that most mortgage application fraud seen today is what is termed as “fraud for housing”, where applicants will either fabricate, embellish or conceal elements of their personal circumstances in order to obtain a mortgage loan.

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Often in these scenarios, the guide states lending will not be affordable or across the term of the mortgage advance.

As a result of this type of fraud, the guide notes some customers may experience financial difficulty in the future.

To ensure mortgage brokers are preventing fraud, the SMP guide recommends their firm’s internal procedure if fraud is suspected and obtaining advice on how to complete.

The guide also recommends brokers send a Suspicious Activity Report to their local compliance team.

David Thomas, chair of the Society of Mortgage Professionals, said: “We all have a collective responsibility to combat fraud and financial crime in the sector.

“With continuously new and emerging technologies changing the way we do business in the mortgage profession, the methods of fraud are constantly changing, too.

“As such, mortgage professionals need to keep abreast of these changes to protect the ability of the profession to keep serving society, and enabling people to become homeowners.”