According to Equifax Canada, one in ten Canadians admit it’s okay to inflate their annual income on a mortgage application, and 9% also admit they hadn’t been entirely truthful on past credit or loan applications. And that’s just the ones who admitted it.
While these seemingly little white lies may seem okay to get better chances with a mortgage loan, this is in fact mortgage fraud.
“Make no mistake, lying on your loan application is a type of mortgage fraud,” said Ashby. “Whether you’re a lender or a consumer, data protection and the integrity of the data should be priorities at all times. For the consumer, it’s not just a matter of protecting your information, it’s critical to know what’s on your credit file – especially when looking to buy a new home.” [Equifax Canada]
While these ‘soft crimes’ are not always reported to the police, it can has consequences for everyone. When these falsifiers default on these loans, the cost of borrowing in turn is raised across the board.
Lenders pass along their losses to you and me. The perpetrators themselves lose their properties, are subject to owing shortfalls to lenders/insurers and leave themselves open to criminal charges. [Canadian Mortgage Trends]
