Cash advance credit card before mortgage

Thinkandgrow1

Hello I need some advice please and hopefully no judgement. 

I used my credit card through PayPal to send £4000 to a friend of mine over 6 different payments as I was purchasing several items from him for my business. Little did I realise but Barclays classed these is a “cash like” transaction and charged me fees and marked the payments on my credit file. I am applying for a mortgage in the next 2 months. I am worried this will have an impact. I have no adverse credit, no defaults, ccj, pay day loans. The card has been paid off for 2 months and I have closed it down. Spoke to mortgage broker and he said we won’t know until we do full application but if a high street bank doesn’t consider it it’s likely a smaller non credit scoring building society will be sympathetic. Ultimately he thought it would be ok. My deposit is 20% for the house. Just needing some advice please as very worried. 

Thank you. 

Brie

Timing may be crucial on this.  When did you lend the money and when did you pay it off?  And when did you close the card account.  

Have you looked at your credit record (not your score) to see what it shows?  Frankly I don't think a credit record shows any specific about how you are using your card - i.e. purchases vs cash advances.  It will show if you haven't cleared the balance in any month.  But that is not necessarily a problem if you are clearing it quite quickly.  You'll want all of this info to be available on your credit record but it can take up to 3 months to be updated. 

So say the money being sent to paypal was done in Nov and you started clearing this down in December and completely cleared early Feb.  Card closed in Mar?  So your credit history will show the card being used but not paid off in full Nov - Jan but perhaps big chunks paid and more than the obvious minimum.  Then it shows the card cleared in full in Feb so everything is showing as green which is good.  If you are applying for a mortgage in June or July the fact that the card has been closed just might be obvious by then which means that you have paid off the account nicely and lessened the amount of available credit you have.  

So this is the next thing - are there other cards, overdraft, lines of credit that you don't actually need or use that you can also close?  The less credit available the better client you can be because it means you aren't about to book a round the world cruise and have to pay both a CC and your mortgage from whatever income you have.   

Essentially if you have a good "green" credit record with what might be 1 tiny blip that has been sorted I don't think there's too much to worry about.  But maybe it's a case of having an informal chat with a mortgage provider prior to actually applying and they can give you an indication of what they might do.  I did this the last time I was looking at a mortgage and was told they wouldn't touch me - mostly due to my excessive available credit - so I was able to plan around that.  

Thinkandgrow1

Thanks for your detailed response.
card was cleared in feb and closed in March.
i have closed down 3 other credit cards too.
i have one left still open. 

They do shows as “cash advances” on credit file unfortunately. 

Mortgage advisor seems to think it will be ok. I was just looking to see if anyone here had similar experience. Might have to go with adverse lender. 

amnblog

Sounds like...

1. You are worrying over nothing
2. The Broker thinks it won't be a problem but is reluctant to say so flat

Thinkandgrow1

thank you very much that’s very reassuring. I hope so - just tend to worry when it comes to mortgage applications. Thanks again