It's likely that if you're applying for your first mortgage that you have spent a considerable about of time saving a down payment and making sure that your credit ratings are in order so that you will be approved and can go off to buy that house for sale in Markham or property in Tampa Bay. And if there is one thing on your application that you think could be a little better to help you get the amount that you're looking for you might be tempted to just lie and give your potential lenders the answer they're looking for. But, lying on your mortgage application can actually mean that you've committed fraud and could leave you liable for fines and even jail time.

The most common instances of mortgage fraud that lenders see on applications are income fraud and the failure to disclose information. These are both pretty self-explanatory. Income fraud is where a person adjusts how much they make in order to qualify for a larger loan. That person might be interested in the Toronto town homes and condominiums for sale that are just out of their price range or think that they might be getting a raise in the future anyway, so that there is no harm.

Failure to disclose could refer to other mortgages the person already has, newly acquired credit card debt, or even student loans. This affects the debt-to-income ratio that lenders use to determine how likely it is that you will be able to pay back your mortgage on your new home. There is a reason that they are likely to give more to a Mississauga lawyer with limited loans rather than an executive assistant who is still paying off $10,000 in student debt. It really is in your best interest to fill out all of the forms correctly and get a loan amount that you will actually be able to pay back.

There are also some people who are not just naive about applying for a mortgage and are legitimately trying to scam the mortgage lenders into giving them more money or a better interest rate. One of the ways that they might do this is by claiming that they will live in the home they are purchasing when it is really an investment property. Most lenders will give a lower interest rate to those occupying the home because there is less of a risk of damage to the property. They are also likely to give a larger loan to these people.

Penalties for mortgage fraud can mean fines of tens of thousands of dollars and a sentence of up to thirty years in prison. When you're filling out your initial mortgage application or even applying for refinancing Toronto based you should make sure that all of the information is completely accurate.