Nearly one in six (14 per cent) UK adults do not think providing mortgage lenders with misleading information is illegal, research from Cifas has revealed.
The research, which surveyed 2,000 UK adults, found 16 per cent of individuals admitted they, or someone they know, have misled mortgage companies about their annual salary to purchase their dream home.
This took the form of inflating earnings by as much as £10,000 or even forging payslips in order to get the keys to a property.
It was also discovered that 9 per cent of respondents considered this exaggeration as “reasonable”.
Cifas CEO, Mike Haley, said: “While buying your dream home can be an extremely exciting time, it is important to be realistic about what is affordable.”
He added that being dishonest about earnings and providing false information when applying for a mortgage is “not the answer” as it is illegal and can make life “incredibly difficult” when making repayments.
However, this practice was not equally common across all ages with the 25-34 age group being found as the most likely to indulge in mortgage application fraud.
Mortgage Advice Bureau deputy CEO, Ben Thompson, said this was not entirely unsurprising as there were affordability barriers holding this generation back from aspirations of owning their own home.
“While more needs to be done to raise the awareness of just how serious mortgage fraud is, the government also needs to look at the root cause of this issue,” Thompson said.
“For younger buyers in particular, it must use the various tools it has at its disposal to smooth the path into homeownership.
“It shouldn’t be the norm that people can’t buy their first property until they are well into their 30s, and the government must do more.”
Thompson additionally stated that awareness at all levels is “key”, especially in the more pressured financial times the industry is currently experiencing.
Overall, Cifas’ research also revealed a year-on-year increase in people committing one or more first party fraud, with one in eight UK adults admitting they had done so in the past 12 months.
tom.dunstan@ft.com
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