Mortgage advice - poor credit.

sweetzebs

I currently have £75k mortgage till March 2011 fixed at 5.19% with excellent credit history . My soon to be hubby has adverse credit which we are trying to repair with cc's etc. We are saving for a place togther, we have £18k at the moment and are currently saving £2k a month into various savings accounts which should hopefully give us in the region of £65k. Question - as we are probably not going to be looked upon too favourably from mortgage lenders in the future - is it better to have a bigger deposit (hard cash) or overpay the mortgage and have less 'hard cash' but a smaller mortgage?

Cannon_Fodder

The best rates, or at least better rates, are obtained with higher deposits.

Whether this will still apply in 2011, no-one knows.

Is the adverse credit "history" or current "debt"...?

Clear the debts. Tidy up any history where possible.

But also keep something for a decent deposit, 25% or so.

Trying_to_be_good

If you're selling your current place and buying a new place, the equity in the current place will count as the majority of the deposit on the new place - you don't need a further 25% in addition to the equity you'll be reinvesting.

You will need some money to cover the fees and stamp duty etc associated with moving, so remember to keep that to one side.

Conrad

Hard cash. Overpaying current mortgage won't make the slightest jot of difference.