Lying On Mortgage Application
First Published: ADawnJournal.com December 31, 2009
Buying a new house, selling a house, or staying in a house all require some level of co-operation between yourself and others. Obviously this includes your family and others close to you, but it also requires collaboration between you and the lending institutions who furnish you with a mortgage as well as a range of others who may be able to help you if you are finding it difficult to maintain payments on your mortgage. Any homeowner, especially one in their first house, will be keen to do things correctly, so it is important to be aware of the importance of doing things in the right way. Maintaining communication with the relevant companies and organizations is the soundest way of doing this.
It has become the accepted wisdom that people lie on forms. Job applications and resumes, insurance claims and credit applications are all examples of forms where people have been known to be “economical with the truth”. While the practice of lying on a job application has come to be the norm and is even tacitly encouraged, it can still get you fired if it is a) serious enough and b) found out. Where finance is concerned, though, it can be a criminal matter if you knowingly withhold information or give false information. A policy of total disclosure – while it may cause you to have narrower options in the short term – will not only work better for your conscience, but it will make the long-term maintenance of the mortgage all the more comfortable.
The reason this is beneficial is that mortgage lenders offer deals on the basis of a large amount of information given to them. If you lie about your salary in order to have greater borrowing power, it could work. At the time, you will want it to work. However, after some time you will begin to feel the pinch of repayments and the financial situation can very swiftly spiral out of control, affecting not only your ability to make mortgage payments but also your financial position overall. Telling a “little white lie” on the mortgage insurance may help you lower the premium, but if you then try to claim on the insurance it could stop you receiving anything.
Aside from mortgage lenders there are other organizations who you would do well to bear in mind. If you are finding payments difficult to make, a debt counselling organization may well be the life-saver you are looking for. In this respect, a word of advice that may well be to your benefit: always look for a non-profit debt management or counselling company. Although the profitable organizations can generally afford a high advertising budget, remember that they are doing that with people’s money, money which has been sent for the purposes of debt management. By going with a non-profit company, more money goes towards paying down your debt, and helping you stay in your home. You may even be able to get the interest payments on your mortgage stopped for a period.