Staged income is a common form of mortgage fraud in which applicants create false income streams to qualify for a mortgage they may not be able to afford. This is typically done by making regular payments throughout the application process which end shortly after completion. As a mortgage adviser, it is crucial to spot these red flags and take steps to protect yourself and your lender.

To protect against staged income, there are several key warning signs to be aware of. Firstly, look out for applicants who have only been employed for a short time, immediately prior to the mortgage application request (three to six months). This is often a sign that the income is being staged to qualify for the mortgage.

Changes in job role that appear out of sync to their experience, age, or location can also be a red flag for staged income. Similarly, applicants who have recently started second or even third jobs where this income is required to support the application may also be attempting to stage their income.

Other warning signs include employers who are small, difficult to trace, or contact, as well as family employment. Finally, be on the lookout for salaries that do not obviously reflect the size or establishment of the employer. By staying vigilant and taking proactive measures to protect against fraud, you can help ensure that your clients are qualified for the mortgages they need, while also protecting your business and the lender.