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Mortgage Vs Personal Loan
GDoggMK
Posts: 3 Newbie
Hi Guys, I need a bit of advice please.
I am a first time buyer and have managed to save up enough for a decent deposit. However I have an oustanding personal loan of £7500.
If I pay this off now, It will cost me £6200, but means I wont be able to be in a position to then buy my first property.
What do you suggest I do? Is there anyway of including my loan into my mortgage cost? Or shall I pay off the loan, become debt free and just take the hit for the rest of the year and save up again?
Any help would be gracefully received.
Thanks
Graham
I am a first time buyer and have managed to save up enough for a decent deposit. However I have an oustanding personal loan of £7500.
If I pay this off now, It will cost me £6200, but means I wont be able to be in a position to then buy my first property.
What do you suggest I do? Is there anyway of including my loan into my mortgage cost? Or shall I pay off the loan, become debt free and just take the hit for the rest of the year and save up again?
Any help would be gracefully received.
Thanks
Graham
0
Comments
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What's the problem?
Do you not want to pay the loan and the mortgage payments, or are they unaffordable together?
What's your current status? Are you renting and paying the loan now?
You either pay off the loan and put off buying, or you have the loan and the mortgage at the same time.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
I proabably could afford them both together, but would having that loan have an impact in obtaining a mortgage?0
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Lenders look at affordability, so you'll find you can borrow less as a result of having a loan.
For example, the annualised equivalent of a £200pm loan is £2,400. The lender knocks that off your income, before multiplying it for a mortgage.
If you earn £30k, you could borrow £120,000. With the loan, that drops to £110,000.
That's a crude example, but it serves to emphasise the situation.
By all means pay off the loan if you can. It depends on your housing situation and what you want to achieve...I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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