More than a quarter of Australia's recent home buyers have fudged some information on their mortgage applications, including overstating their household income.  That's according to a survey conducted by the investment bank UBS.

Most of the 1,228 buyers responding to the survey over a two year period said they provided "mostly factual and accurate" information on the applications.  But 28 percent admitted providing fiction to their banks.  Of those who 'fessed up to being less than truthful, 14 percent overstated household income, 13 percent overstated asset values, while 17 percent understated their debts. 

But the UBS analysts believe that this may only be the tip of the iceberg:  "If anything, we believe it is more likely these figures may understate the level of misrepresentation in mortgage applications as some respondents may not want to state they were less than completely accurate despite anonymity," they wrote.

The survey showed that buyers tended to tell the truth more often if they dealt directly with banks.  But nearly a third of people who got their mortgage through a broker admitted they were not "completely factual and accurate" with their information.  The UBS analysts say the banks need to pay attention to this:  "We believe banks need to tighten underwriting standards via the broker channel, even at the expense of near term market share," UBS warned.