LoFi

What do mortgage companies make of credit card debts when you make a mortgage application?

LoFi

Boro

iTrader: (1)

I would assume it depends on how much is owed and what it would cost per month to repay. I thinks its just part of the "means to pay" calculation.

LoFi

So if I'm paying them off with equity from my sale it shouldn't matter that I've spent a fortune on the scoob?

LoFi

fast bloke

As long as you can show there is enough 'spare' borrowing to clear them they do not usually factor them in. If not they subtract the entire amount from your salary before working out the income multiple

LoFi

Now I'm scared

LoFi

BOB.T

I owe around 8K on cards and my application has just gone through..I say gone through, they've done all the credit score gubbins and instructed a bloke to value the house I want to buy

I honestly didn't think they'd go for it, just give it a whirl and see what happens

Good luck

3times

Most lenders annualise your monthly payments and deduct these from your income.

As the rules now stand you could say you are going to clear the debts and not do it as solicitors will no longer make sure these are cleared. You would have to watch this though as some lenders may ask for proof after completion and could, in theory, prosecute for fraud (I do not know of any case where this has happened though).

fast bloke

Slightly worse than prosecution - They could insist you redeem your mortgage immediately. As a rule, they don't bother

LoFi

3times - if it is the case that they annualise the monthly payments and deduct from salery, having done the sums I should still be ok.

I do actually intend to use (some) of the equity to kill the cards.

Thanks guys - I might sleep slightly easier now.

LoFi