More than a quarter of prospective and recent homebuyers have hidden or played down their spending habits, while one in four keep savings accounts secret from partners or family, research from Mojo Mortgages suggests.
The online mortgage broker’s study found that 26% of respondents had downplayed or concealed day-to-day spending during the homebuying process, including discretionary purchases and betting activity.
The findings point to the financial pressure facing some buyers as they try to strengthen their position ahead of a mortgage application. However, the research also identified more significant financial information being withheld from partners or family members.
One in four respondents said they maintained a secret savings account, while 18% had concealed debts such as credit cards or personal loans. A further 13% said they had lied about their salary or bonus.
John Fraser-Tucker, head of mortgages at Mojo Mortgages, said: “While it is understandable that buyers want to present the cleanest possible financial footprint to mortgage underwriters, keeping significant financial secrets, such as undisclosed debt or secret accounts, from a buying partner can build a shaky foundation for long-term financial health. Honest communication is vital when entering into one of the largest financial commitments of your life.”
YOUNGER BUYERS MOST LIKELY TO KEEP MONEY SECRETS
The research found a marked difference between age groups, with those aged 25 to 34 the most likely to report some form of financial secrecy.
Some 68% of respondents in this age bracket admitted to hidden money habits, while 30% said they had specifically downplayed or concealed discretionary spending during the homebuying process.
Buyers aged 55 and over were the least likely to keep financial secrets, although just under 55% still reported some form of discreet financial management.
There was also a difference between men and women. Some 64% of male respondents acknowledged at least one financial secret, compared with 59% of female respondents.
BROKERS NEED FULL FINANCIAL PICTURE
Fraser-Tucker warned that withholding material financial information could create problems during the mortgage process.
He said: “Honesty really is the best policy when applying for a mortgage, both between partners and with your mortgage broker.
“Hiding debts or overstating income can lead to severe delays, unsuitable products, or even declined applications, whereas total transparency allows your broker to match you with the best possible deal for your actual circumstances.
“That being said, if you find yourself managing finances alongside a partner who is financially unstable or reckless, holding back a personal emergency fund isn’t just understandable, it’s smart planning.
“Never stretch yourself so thin that you pour every last penny into a property without keeping an independent rainy-day fund to protect your financial safety.”
