Private lenders are stepping up their defenses against rising fraud in the commercial mortgage sector — a growing concern as delinquencies trend upward nationwide. According to a recent Mortgage Professional America feature, many of today’s problem loans can be traced back to inflated appraisals, falsified financials, or incomplete borrower disclosures. Bayport Funding CEO Marcia Kaufman emphasized that while some lenders compromised credit standards in pursuit of volume, Bayport’s disciplined underwriting and rigorous borrower vetting have helped safeguard its portfolio performance. Industry organizations like the National Private Lenders Association (NPLA) are now working to combat fraud by creating shared watchlists of known bad actors and encouraging collaboration among lenders. Kaufman noted that open communication and proactive due diligence — such as reviewing litigation and foreclosure histories — are essential for preventing fraud before it starts. As fraud detection tools and data-sharing improve across the industry, responsible lenders like Bayport continue to set the standard for transparency, integrity, and sound portfolio management.
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