The figure is 77% up on the same period in 2010.
Current accounts also continued to be frequently targeted by fraudsters, with 30 in every 10,000 applications found to be illicit.
Fraudulent savings account applications also increased in Q3, up 47% year on year and 16% over the last quarter.
Nick Mothershaw, director of identity & fraud at Experian UK & Ireland, said: “More than 90% of mortgage fraud tends to originate from genuine individuals misrepresenting their financial situations attempting to buy property that would ordinarily be out of reach.”
Mothershaw added that savings accounts are increasingly being used for money laundering purposes or as a springboard to more lucrative credit products.
The data is taken from the National Hunter and Insurance Hunter fraud prevention systems, which Experian manages on behalf of its clients. The analysis software enable financial companies to analyse applications against historical context and highlight inconsistencies which may be indicative of fraud.
Credit card fraud also increased for the third consecutive quarter, up 10% on Q2 2011 and 7% on the year. The fraud rate for credit cards now stands at 13 in every 10,000 applications, the highest level since the period of April to June 2010.
However, insurance fraud fell by 8% quarter-on-quarter to 11 in every 10,000 applications. This was a 28% increase on Q3 2010.
The good news is loan fraud remains the least targeted credit facility of the financial products Experian analyses, remaining constant at a rate of six fraudulent applications per 10,000 received, which converts to a 10% fall.
