mortgages

[beaniedog]

on self certificated mortgages - am i right in assuming most people lie - and if so is this illegal ? who would be interested if you did - as long as payments were made on time ??? a friend of mine is thinking of doing so.

[Buenchico]

There are probably plenty of people who've lied but, since not many people will admit to it, it's hard to say what proportion of all applicants have done so.

Is it illegal? Definitely. (Section 15A of the Theft Act, 1968).

Who'd be interested? PC Plod and his chums. If a lender discovers any irregularities in an application, even if payments are kept up, the police must be informed otherwise the lender is breaking the law.

The penalty? Probably somewhere between 6 months and 3 years.

Chris

[Hermia]

A friend of mine lied on her self-certification mortgage. The plod haven't called round yet, but it's likely she will lose her house at some point. She lied because she isn't earning much and no-one would give her a mortgage.She is finding the payments a real struggle and if interest rates rise she is in deep trouble.

[WoWo]

Hermia is correct, the whole reason a bank will lend 3 1/2 times a salary is because that's whats affordable for people to pay back. Self Cert is for people who genuinely cannot prove they earn a regular amount, even if they make a false claim they could be prosecuted.

Having said that most lenders don't give a toss as long as your paying up each month, Buenchico is correct in the fact they would be legally obliged to notify the Police if they found out but they are unlikely to check unless it was going to effect them.

However.... last year there was a change in the mortgage law, it used to be the case that the person getting the mortgage was liable if later found out, now the situation is that the lender is also liable and therefore more likely to check up in the first place.

I suppose it comes down to a moral issue, if not a strong legal one. If I killed 10 tramps and nobody cared are noticed would that be OK? An extreme example but same principle.

[beaniedog]

has anyone ever heard of anyone being 'nicked' for such an offence and actually doing time? also does the same law apply to your average loan- as long as it get paid back??? thanks for previous answers by the way!

[WoWo]

To be honest I think it's low risk in terms of getting caugh or being prosecuted. I doubt the CPS would even sent it to court..

The real risk is failing to keep up payments on the mortgage and losing your home (along with the deposit and any money you may have paid in to the mortgage in the mean time). The point being your taking on a mortgage you can't really afford to pay.

In addition to this you would be in breech of your Mortgage contract terms and the bank could demand the money back at any point (they pretty much can anyway).

Yes the same (or similar) law's apply to normal loans, if you enter false information into a loan application you will be commiting fraud.