Have you heard the saying “honesty is the best policy?” That is generally true in life—but it is especially true when it comes to real estate.
If you are buying a home, lying to your lender—even a “harmless” white lie—could jeopardize the whole deal. And while you should refrain from telling any lies, there are certain ones that are almost certain to cause issues with your real estate purchase.
So what, exactly, are those lies? A recent article from realtor.com outlined the white lies that could destroy your chances of successfully buying a home, including:
Saying you are going to live in the home, when you are actually planning to rent it out.
If you are planning to buy a house as a rental property (whether for a short-term or long-term rental), you need to disclose it. If you don’t, it could be considered mortgage fraud—which can result in a felony charge.
Not being honest about where your down payment money is coming from.
It is certainly not uncommon for buyers to get financial help when they are buying a home. But if someone (for example, a parent) has gifted and/or loaned you money to cover your down payment, you need to let your lender know. Generally, it won’t be a problem—but if you lie about where the money came from, that could end up being a problem.
Leaving out debts.
When you apply for a mortgage, you need to disclose every single debt, no matter how big or small. Your lender will discover the debt during the underwriting process—and if they find out you knowingly lied, it could cost you your mortgage.
Tell it like it is. If you are thinking about buying a home, let's connect. We can help you achieve your homeownership dream!