Doubtful. Most of the fudging on loan applications has been done by mortgage brokers, eager to get a fat fee and move on to the next one. A guy who speaks little English and has a 6th grade Mexican education was definitely not filling out applications unaided.
At the risk of advocating government regulation, this problem could be avoided in the future if it was made illegal to sell home mortgages, or for anyone who is not an employee of the lender to receive a fee for originating a home mortgage. If homebuyers had to go directly to a bank to apply for a mortgage, and the bank knew it would be stuck with the loan until maturity or sale of the property, the banks would be very careful about who they lent to and on what terms.
“At the risk of advocating government regulation, this problem could be avoided in the future if it was made illegal to sell home mortgages, or for anyone who is not an employee of the lender to receive a fee for originating a home mortgage. If homebuyers had to go directly to a bank to apply for a mortgage, and the bank knew it would be stuck with the loan until maturity or sale of the property, the banks would be very careful about who they lent to and on what terms.”
Your solution would crash the market for possibly decades. Your cure is far worse than the disease.