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mortgage lending amount & paying cc debt with equity
kez1_2
Posts: 44 Forumite
(also posted in house buying board)
oh my goodness, so many questions but will try and keep it breif and explain all!
we went to a mortgage broker last year and got an idea of what we would be allowed to borrow (to be honest i was shocked at the difference between the amounts different lenders might lend us, i know they use differnt methods to judge but even so, easy to see why people get in to difficulty)
anyway, back on track....between us we have approx £6.5k debts in credit cards, now we are in the very fortunate position that we will sell our present home, have enough equity to put down a deposit AND PAY THESE CARDS OFF (and trust me lesson learnt! with the help of this site and the hope to start afresh i know we will not end up with cc debt again!)
so my point is that the broker didnt include these cc amounts when he was working out the figures as we said they would be paid off via the equity, however (and sorry if i'm being a dufus here) surly the funds from the equity wont be in the bank until the sale has gone through? (obv minus deposit & legal fees) so surely the lender will have to be informed?
i do not understand? surely anyone could say 'oh ignore that we are going to pay it off' but they have no intention of doing so? (just to clarify - we WILL be paying them off, then buying a bottle of nice wine with a nice crisp £10 note and celebrating! notice i said wine not champayne!)
hope all that makes sense!
oh my goodness, so many questions but will try and keep it breif and explain all!
we went to a mortgage broker last year and got an idea of what we would be allowed to borrow (to be honest i was shocked at the difference between the amounts different lenders might lend us, i know they use differnt methods to judge but even so, easy to see why people get in to difficulty)
anyway, back on track....between us we have approx £6.5k debts in credit cards, now we are in the very fortunate position that we will sell our present home, have enough equity to put down a deposit AND PAY THESE CARDS OFF (and trust me lesson learnt! with the help of this site and the hope to start afresh i know we will not end up with cc debt again!)
so my point is that the broker didnt include these cc amounts when he was working out the figures as we said they would be paid off via the equity, however (and sorry if i'm being a dufus here) surly the funds from the equity wont be in the bank until the sale has gone through? (obv minus deposit & legal fees) so surely the lender will have to be informed?
i do not understand? surely anyone could say 'oh ignore that we are going to pay it off' but they have no intention of doing so? (just to clarify - we WILL be paying them off, then buying a bottle of nice wine with a nice crisp £10 note and celebrating! notice i said wine not champayne!)
hope all that makes sense!
0
Comments
-
It is perfectly normal for the lender to accept the fact that the debt are to be paid off via equity post completion of the purchase of the new property.
The only other way to do it is to give the account numbers etc to your solicitor and have them arrange for them to be paid off directly but this is un-necessary and will cost you approx £35 in telegraphic transfer fees for each one.
The lender will trust that you are paying the debts off yourself.0 -
i see, thankyou so much for replying, it has been worrying me!
thats great, thanks again!0
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