What's stopping people from lying about your income?

[deltatee]

Technically lying would constitute Bank Fraud, which is a federal crime and carries some hefty civil penalties so there's that. I'm not saying it gets used against common consumers who lie about their income on their application and doesn't otherwise default or anything, but it does exist.

More practicially, I guess there is a possibility that you could end up losing your account and credit, which could negatively impact your credit and your relationship with the bank.

It's definitely best for people to be honest, but I have no doubt there are a number of people who lie about their income.

[creditguy]

What keeps a person from lying? Their conscious!! Either you have morals or you don't. If you have morals you don't lie, plain and simple. Have people fudged a bit? I'm sure. A person who fudges may round off $39,975 to $40k, no big deal, but still technically a lie, probably not going to cause any AA or scrutiny, now a person who adds thousands well that's a different matter. You may not see a jail cell for lying about income, but your definitely going to lose a card if caught and probably find yourself on a blacklist, in some cases depending on the card, jail would be the less harsh punishment than blacklisting. Why take a chance? 

[atd1970]

This is a really interesting question and a problem CC companies have created. Some companies ask for individual income, and others from any reasonable source. So on one app my income is $50000, another I could include my partners income $150000. Big difference. Yet my partner may not know I am applying for credit. Is that a lie?

[-Cal-]

Some lenders verify income using 3rd party services so the verification process is transparent to the applicant.

As others have stated, lying about your income is fraud and isn't something you would want to deal with if prosecuted.

[FinStar]

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@atd1970 wrote:
This is a really interesting question and a problem CC companies have created. Some companies ask for individual income, and others from any reasonable source. So on one app my income is $50000, another I could include my partners income $150000. Big difference. Yet my partner may not know I am applying for credit. Is that a lie?

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The CC companies did not create this problem.  This was a result of the CARD ACT regulations in addition to ammendments made by the CFPB in 2013 (i.e. stay-at-home spouses and partners to obtain credit cards including consumers who are 21 or older to rely on accessible income for credit card applications).  Please read the regulations, it's all there.

Now, some lenders adopted specific guidelines for reasonable access to income, assets, etc., while others require the individual income of the applicant - remaining compliant with the CARD ACT (and its revisions).  So, when filling out an application, it's explictily stated by the lender depeding on which applies in your case.

[tntexans72]

Idk, banks are pretty much like the FEDS, they know everything about you! If you have high trade lines and you start to charged it up, I am sure their system will start flagging your account(s) and if you are just paying back the minimum, you are going to get a CLD. We are talking about $$$ here, banks ain't dumb. 

[Anonymous]

I notice a surge in asking for Profession as well as income. 

+1 Sunrise.  Lender could just send a form to the Taxman, see what you're worth.  Why bother lying.  Too much effort.  

There you go, My Neighbor Totoro. 

[TitaniumCash]

You might have to provide proof later on when something pops up and it will not look good on your part for lying. Rounding up reasonably is okay, but blatantly lying is wrong.

[Anonymous]

I'm too paranoid for such shenanigens.

[Anonymous]

What does AA mean?