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    • shopaholicno1
    • By shopaholicno1 5th Mar 18, 11:30 AM
    • 123Posts
    • 474Thanks
    Applying for mortgage with recently paid off debt
    • #1
    • 5th Mar 18, 11:30 AM
    Applying for mortgage with recently paid off debt 5th Mar 18 at 11:30 AM
    I recently (a week ago) cleared my next account balance to £0 from
    However, as it's so recent it's still showing on my credit file at £1400, which is what the balance stood at 5 weeks ago now.

    We have seen a house, and want to apply for a mortgage. Can my mortgage broker inform a lender the debt has been recently paid? Do I need to state I do have a debt even though it is paid off on the forms when applying?
Page 1
    • SharkBite
    • By SharkBite 5th Mar 18, 11:39 AM
    • 35 Posts
    • 18 Thanks
    • #2
    • 5th Mar 18, 11:39 AM
    • #2
    • 5th Mar 18, 11:39 AM
    Depends on the lender I think. Most have an option stating the debt will be / has been settled.

    I recently had this when I applied with Natwest. I included debts on the application even though I had settled them. But I was able to tick a box saying they will be repaid before completion.

    They didn't query anything and my settled accounts were much larger than £600.

    The main thing is the affordability model each lender uses.

    I'm in no way an expert BTW just talking from recent experience.
    • juniordoc
    • By juniordoc 5th Mar 18, 12:07 PM
    • 351 Posts
    • 279 Thanks
    • #3
    • 5th Mar 18, 12:07 PM
    • #3
    • 5th Mar 18, 12:07 PM
    You don't need to apply for a mortgage until your offer has been accepted. A premature application will show up on your credit file. If your seller also has to find somewhere to buy then there may be no point sending off your application for a couple of weeks yet.
    When you do get round to sending off the application, as above mention that these debts are recently settled.
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