What is a likely consequence of contract kiting for the borrower?

When a borrower engages in contract kiting, they are typically involved in a deceptive practice that may involve creating false agreements to secure loans or financing. This misconduct can lead to severe consequences, notably in terms of loan approval chances.

Lenders conduct thorough background checks and assessments of an individual's creditworthiness and financial history. When irregularities such as kiting are discovered, lenders often tighten their scrutiny of the borrower's financial applications. This results in reduced chances of loan approval as lenders see the borrower as a higher risk due to their questionable financial practices.

In contrast, while inflated credit scores, delays in closing the sale, or options for refinancing may initially seem plausible as consequences, they do not directly capture the most immediate outcome from engaging in contract kiting. Rather, the primary concern will be the heightened skepticism from lenders leading to more stringent evaluation processes and a diminished likelihood of securing future loans.