UBS research found 37% of borrowers who took out a home loan in the 6 months to December 2021 made false representations on their application.

The research found that for those who had taken out a loan with ANZ, more than half (55%) had been less than honest.

The survey shows 1 in 5 experts (22%, 4/18) say these “liar loans” could indicate there is a higher level of risk in the market than the RBA is taking into account.

Dr Angela Jackson from Impact Economics and Policy disagrees, but notes, “the potential for a number of borrowers… to borrow [more than] 6 times [their] income could [be] trouble if rates increase quickly and/or unemployment increases.”

Dale Gillham from Wealth Within said liar loans were nothing out of the ordinary.

“Liar loans are normal and the recent figures would not be a surprise to the RBA,” Gillham said.

Tim Reardon from Housing Industry Association said local lending standards were particularly strict.

“Lending standards are tight in Australia by international standards and banks conduct their own due diligence,” Reardon said.

A fifth of experts (20%, 3/15) expect the trend of liar loans to increase.

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