FTB - Please Advice

VIGILANT22

[QUOTE=Idiophreak;29115999]No brainer for me, assuming you've a decent rating

- just keep paying the loan over the 15 months. The 8% you pay on that will be much less than the interest you'll pay on £6kmore on the mortgage.

If you're saving £1k/month, it doesn't sound like it will effect your ability to repay, affordability criteria etc.

Ignore dumb and dumber squabbling above (they can fight it out for which is which). In answer to their general ramblings, your credit score would be improved *now* by having less outstanding debt, but longer term, having repaid more payments successfully, it will be better to pay it over the term.

You *can* build your score as well as ruin it - you don't start off with a perfect score.[/QUOTE]

1. Idiophreak If you had been really "smart" you would have answered the OP without making any reference to dumb and dumber

2. Rasnii......Quote "No brainer for me, just keep paying the loan over the 15 months.".......This is not entirely a no brainer......

We dont know your salaries, don't know what the 33k means in % terms for deposit as we have no idea what house values you're looking at. We don't know your current outgoings which allows you to save 1k a month...it could be you're both living at home and expenditure is very low etc....

The way lenders calculate affordability varies for example Alliance & Leicester uses an affordability rate of 6% (or product rate if higher) to calculate how much you can borrow. This takes account of income, regular commitments and living expenses.

Don't make any decisions until you meet up with a whole of market of broker and have a full discussion. They can produce quotes where you can see if you paid off the loan and applied the extra 376 for the loan to the mortgage for the duration of the loan the effect this would have....
Discuss the need for an emergenct fund.
Discuss the need for mortgage/loan payments being covered in the event of illness etc
It is not as simple as coming on here and getting the answer like "no brainer"!....
As stated you're a FTB, therefore it is very important you receive professional "advice".....please remember this is a consumer site whereby people give opinion, even those with signatures saying mortgage adviser...give opinion not advice
Ask your family/friends/colleagues to refer you to a whole of market adviser they have used and been happy with, then meet up for a discussion also ask them to explain the whole buying process including what to expect for conveyancing, do you have to pay stamp duty etc...and good luck.........:)

rasnii

Thanks to you all for the input.

Been away for a while due to family issues, but now back. shall update you guys when I have the chance.