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Is that “white lie” on a mortgage application okay?

On Behalf of | Jan 29, 2021 | Real Estate Law |

Mortgage lenders have tightened their purse strings ever since the big real estate bust back in 2008. They’re now inclined to be a lot pickier about who they will fund.

Someone suggests that you might use a little “white lie” on your mortgage application to secure the deal. Is there really any harm in it?

A deliberate lie on your mortgage application is an act of fraud

People make mistakes all the time on their mortgage applications. After all, those forms are confusing and they ask a lot of questions. There’s a big difference, however, between a mistake and a deliberate falsehood.

Lying on a mortgage application is a crime. People still do it, naturally, usually in the following ways:

  • They exaggerate the amount of their assets
  • They hide the source of the funds for their down payment
  • They falsify their income so that they seem better able to afford the payments
  • They claim that they’ve been with an employer longer than they actually have been
  • They pretend that they’re going to live in the home instead of using it for a rental and an investment property

All of these things can help them get that mortgage they want — but the cost can be considerable if they’re caught.

What if it was the mortgage officer that suggested the idea?

Run. You can bet that they are not handling their accounts in an ethical manner, and you want no part of it. Eventually, they’re likely to be caught — and that can mean the authorities will start combing through every mortgage they’ve handled.

The best way to protect yourself from criminal problems associated with mortgage fraud is to involve an attorney in your real estate purchase. Your real estate deal is important, so protect it.


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