mortgage decline because of overdraft?

HR1_2

Has anyone had personal experience of a mortgage application being rejected because they use their agreed overdraft facility on a regular basis?

I know there are many variables & acknowledge people's views on overdrafts - was looking for other peoples experiences only please.

Thanks

Touchdown49

Your bank details are not on your credit report so unless the lender asks for 3 / 6 months bank statements then they would not know whether you have an overdraft or not.

Confused_Chris_2

but will they reject the application on the basis of using an overdraft??

Fang_3

Touchdown49 wrote: »

Your bank details are not on your credit report so unless the lender asks for 3 / 6 months bank statements then they would not know whether you have an overdraft or not.

Yes they are.

Fang_3

Confused_Chris wrote: »

but will they reject the application on the basis of using an overdraft??

It's possible. An overdraft is not guaranteed, so if you live in it and it is removed, how would you meet the repayments?

Confused_Chris_2

thanks Fang, jsut to clarify this.
I have recently made an application for a mortgage and my statements show i that within 2 of the last 3 months i used the overdraft, mainly due to the fact that a SO to a savings account, resulted in using the overdraft for £20!

Is this likely to cause the application to be rejected??

Thanks

_Andy_

Confused_Chris wrote: »

but will they reject the application on the basis of using an overdraft??

There isn't any point in us speculating. The lender might, they might not, depends on your own individual circumstances.

maninthestreet

Look at it from the prospective lender's point of view - you are regualrly overdrawn on your bank account,
which indicates you are trying to live beyond your means. Harsh though this may sound, this is the way they will look at it.

nomoneytoday

For a £20 overdraft I can't see any decisions hugely changing, unless it's borderline anyway IMHO

akaLadyK

I have lived in my overdraft since university (it is £500) although my wages pay it off obviously every month. I was granted a mortgage. The they asked for proof of overdraft and that I hadnt gone over my agreed limit in the last 6 months

Wakey2008

akaLadyK wrote: »

I have lived in my overdraft since university (it is £500) although my wages pay it off obviously every month. I was granted a mortgage. The they asked for proof of overdraft and that I hadnt gone over my agreed limit in the last 6 months

That's very much the way things used to be, and frankly should be. But some lenders now are declining anyone that has used an agreed overdraft at anytime in the past three months or so even if it went no where near the limit.