Don’t Lie About Your Income
Have you lied about your income on an application for a car loan? Many people do, but the technology used to catch “cheaters” is getting more sophisticated — and a little white lie may just get you denied the credit you need to buy your next car.
First, you should know that auto finance professionals know that many people lie about what they earn. In fact, that data shows that nearly 25% of borrowers inflate their stated income on auto loan applications by 15% or more. (This includes those who do so on purpose, as well as those who simply make a mistake).
US-based credit bureau Equifax said it is now making it easier for auto dealers who use its Credit Bureau Connection products to catch cheaters, by offering them immediate access income and employment data.
In the past, many auto dealers were able to approve loans based on credit score alone. But the financial crisis taught finance pros anything, it is that having accurate income information on a borrower often means the difference between a loan that’s eventually paid-off, or one that goes into default.
Consumers can therefore expect that any income information they give will have an impact on whether they are approved for a loan.
One thing that we would strongly suggest you do is to update the income information that is on file with the financial institutions you do business with. If you are making more today than you were when you applied for credit in the past, the income information that is available on you may well be incorrect.
Also, whenever you think you might be applying for credit, spend a little time calculating your full income picture. For instance, if you have income from sources other than your main job, this should count toward your total income. In other words, don’t cheat yourself by under-stating your income when applying for a loan.
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