Little white lies are harmless, right? Not when they are listed on your loan application. Lies on your loan application are definitely not harmless and, in fact, can be detrimental to your chances of obtaining credit. Different people have different reasons for lying on their loan applications. Some people want to hide a bad credit history while others do not want to reveal personal information. Still, regardless of the reasons, being a loan liar is not a good practice. It can hurt you and undermine your chances of getting a loan. Unfortunately, loan lying is fairly common in Britain.
Who are the Loan Liars?
Loan liars come from all walks of life. Men between the ages of 26 and 40 make up two thirds of those who lie on their loan applications for secured loans, insurance and credit cards. Of these men, approximately 64 percent of them lie to hide a poor credit history. By contrast, 77 percent of women lie on their loan applications to hide a poor credit history. Of this number, 17 percent use an alias. Of all the loan liars, 10 percent admit to using false documents to support their false claims on loan applications. Also, 9 percent of men and 7 percent of women lie about their status of employment or salary.
Why should you NOT be a Loan Liar
Of course, the number one reason to NOT be a loan liar is because it is illegal. Some people don’t care one whit, however, about legalities. That is OK, though, because there are other equally compelling reasons. Consider why you want to get a loan in the first place: to get approved for credit or to get approved for a higher amount of credit. You could be digging yourself into a deeper hole. Suppose you do get that credit or higher limit, now what? How will you make your payments and what do you have at stake that you could lose? If you lied to obtain a mortgage, you could lose your home. Think about it and consider the ramifications before telling that tale.
What Impact do Loan Liars have on Overall Debt?
Loan liars play a large part in incurring overall debt, meaning loans that are not repaid. Large overall debt contributes to higher interest rates for everyone. If you are a part of the problem by contributing to the overall debt, you are part of the reason that interest rates increase. Do you want to be a part of the problem or a part of the solution? It is up to you.
How do you get caught?
More and more companies are catching loan liars before they can do any real damage. How do they do it? Lenders are working together and sharing information with each other and this is making it much easier to catch loan liars. They are using loan data sharing services that catch the loan liars before they are accepted.
Bottom line, it is just not a good idea to lie on a loan. If you do get away with it, you will likely not be able to afford it. If you don’t get away with it, you could face legal problems. It is a no win situation. Play it safe and just tell the truth.