Be Careful What You Say When Applying For A Mortgage

By
Real Estate Agent with RE/MAX Preferred Realty

Be Careful What You Say When Applying For A Mortgage

Owning a home of your very own is exciting and is the American dream.  You should know however that when you apply for a home mortgage you need to be as honest as possible so that your dreams are not crushed at the last minute. Below are a few tips on what not to say when you are applying for a home mortgage.  You may think that a little white lie won’t get you into trouble when applying for a home mortgage but what most people don’t realize is that you will likely get caught in that lie and may end up not getting approved after all.   Also the penalties for such lies can be quite severe such as a 30 year prison sentence and a million dollar fine.

  • If you don’t plan to live in the home in which you are getting a mortgage but rather you plan to rent the property out do NOT apply for a mortgage as your primary residence.  Default rates are higher on investment properties than they are on primary residences.  Down payments are larger on investment properties as well.  These are some of the reasons why folks try to lie about using the mortgage as their primary residence.
  • Lying about how much money you make  to get a home mortgage is also a no-no.  If you try to lie about your income for the purposes of getting a better home mortgage you are very likely to get caught because your lender is going to verify your income by looking at your w-2’s as well as your tax returns.
  • If you don’t have enough money for the down payment on your new home, you CAN borrow it from a family member or friend but if you do this you need to be sure to have the paperwork that supports the fact that it is a gift that you don’t have to repay otherwise it is considered a loan and the mortgage company will need to know about it.  This little white lie may seem harmless but it isn’t and it can get you into trouble with your mortgage lender.

Basically, tell the truth about any and everything your mortgage lender asks you. If you want to have part of the American dream by owning your own home, don’t destroy the dream by lying.  Once you get your mortgage and you move into your new home you will be glad you did everything the right way and that you don’t have to worry about anything coming back on you in the future.

Courtesy of Greenville NC Real Estate Expert Liz Freeman.

Comments (3)

Fred Griffin Tallahassee Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

     It is amazing that would-be borrowers think they can get away with lying to a mortgage lender.  The underwriters will find out everything about you.

Jun 12, 2016 03:24 AM
Carol Wilson
Your $imple Home - Toronto, ON

Very sound advice.  Thanks for the post, Liz Freeman

Jun 12, 2016 03:34 AM
Les & Sarah Oswald
Realty One Group - Eastvale, CA
Broker, Realtor and Investor

White little lies does not apply when one is filling out a mortgage application.  Be truthful or it will come back and bite you real hard.

Jun 12, 2016 04:40 AM

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