Dear Rabbi,

Can you please outline the halachic issues with the following request assuming there are problems.

Reuven was pre-approved for a mortgage through an Israeli bank at x% interest rates. He understands that he if shows a higher joint income with his spouse the % interest would be reduced for the duration of the loan.

Reuven requests of Shimon to provide payslips from a company to provide to proof that Reuven’s wife is earning a large income.

It strikes me that the bank would only be willing to lend at the reduced rate due to the reduced risk of lending to someone with a higher income and therefore the misrepresentation would be tantamount to bank fraud.

Thank you in advance.

Answer:

This is certainly a case of “bank fraud” as you call it, and it is not permitted to do this.

A bank takes a person’s income (or a household’s joint income) into account in determining the “risk factor” in a mortgage, and this influences the rate of interest.

I don’t know if this is true for all banks, but if this is the borrower’s understanding for the creditor bank, it follows that by producing a fake payslip he will be swindling the bank into giving him a lower rate of interest, and effectively “under-pricing” the loan.

This is both a case of “theft” from the bank, and probably a criminal offense.

Best wishes.

Tags: fake halachah Interest mortgage Torah

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