We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Will my unsecured loan be included in mortgage LTV?

hellzapoppin09
hellzapoppin09 Posts: 5 Forumite
edited 10 August 2009 pm31 3:15PM in Mortgages & endowments
hi there

i am new to the forum and would love some advice!

just planning to buy a house with my boyfriend.. i have an unsecured loan of £12k and am wondering if lenders are likely to ignore or include this when working out the LTV on the property we want to buy... ie if i we make £10k each on the sale of our houses so have £20k deposit, will this be used as basis of lending:

ie say on an 80% mortgage for a £100k house i would normally hope to borrow £80k from the bank. but will they say I already have borrowings of £12k so will then only lend a further £68k to make my total borrowings £80k = 80% of the house value?

thanks
XX

Comments

  • _Andy_
    _Andy_ Posts: 11,150 Forumite
    The LTV is not related to unsecured borrowing, so in your example of a £100k house with £20k deposit, the LTV would be 80%.
  • luckyfool
    luckyfool Posts: 1,683 Forumite
    The loan is factored in for affordability and potentially credit scoring, but as _Andy_ says, not the ltv. As long as you are comfortably within income multiples or on the lenders affordability calculation then the loan shouldn't effect you.
  • ye ha that is great news. i can afford to pay the interest on my loan as far as affordability is concerned but was a bit worried that i would be entering the joint purchase of the house with negative £12k !! not a great start.

    obviously i will seek advice from my mortgage advisor but didn't want to go into the discussion blind so thanks so much for your quick replies.

    cheers xx
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 348.3K Banking & Borrowing
  • 252.1K Reduce Debt & Boost Income
  • 452.4K Spending & Discounts
  • 240.9K Work, Benefits & Business
  • 617.1K Mortgages, Homes & Bills
  • 175.6K Life & Family
  • 254.1K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.