Millennials twice as likely to lie about income: survey

Nearly one-in-four millennial Canadians think it’s OK to lie about their annual income when it comes to applying for a mortgage. That’s about twice the broader average.

Those are among the findings of a new study from Equifax that dug into opinions on credit scores, home buying and mortgage fraud.

Not only are millennials more likely to think about stretching the truth, the survey found, they’re also more likely to have gone out and done it. About 19 per cent of millennials surveyed by Equifax said they had not been fully truthful on a credit or loan application. That compares with 12 per cent as a national average, according to the company.

Julie Kuzmic, a director of consumer advocacy at Equifax Canada, said the results were concerning.

“Fudging income numbers when completing a mortgage application is fraud,” she said. Beyond that, inflating an income to purchase an ideal home can leave people stretched thin and unable to make mortgage payments on time — something than can harm credit history and scores.

“What some may see as a little white lie during the mortgage application process could have legal consequences or become a very hard lesson for people to learn if they cannot keep up with their mortgage payments,” she said in a news release.

About 16 per cent of those surveyed believed mortgage fraud was a victimless crime, though 23 per cent of millennials believed the same.

High home prices in many parts of B.C., as well as stricter lending rules have made it more difficult for younger residents in this province to purchase their own homes.

The survey found about 70 per cent of consumers believed the federal government should do more to help homebuyers.

Nearly half of those surveyed said the federal government should relax the mortgage stress test for those buying for the first time, and nearly four-in-ten believed it should be eliminated entirely.

Kuzmic said those looking to buy a home should try to establish “good credit behaviour” before going to see a mortgage lender.

“Mortgage lenders examine credit scores closely, along with other information such as your income, to determine your ability to pay back a loan,” she said. “A spotty credit history isn’t a good recipe for success to receive funding for what may be the largest purchase you’ll make.”

Only 60 per cent of respondents said they check their credit scores before asking a lender to secure a mortgage, and only about 40 per cent of those surveyed said they knew their credit score.

The survey captured responses from 1,545 Canadians from across the country, and the margin of error is plus or minus 2.5 per cent 19 times out of 20.