Need advise - buying a second house

royals182

Hi,
We are looking to buy another house and are selling ours. The problem is I have some unsecured debt which is affecting the amount we can borrow. I would like to be able to pay this off with the equity from house sale thereby allowing additional borrowing for the new house. We would still be living well within our means and would actually have more disposable income.

Equity minus EA fees 95k
Debt 15k

Can give more figures if needed.

Would this be possible and would the bank agree to this?

Thanks in advance for any advice.

kingstreet

Yes. When you complete the application for your new mortgage, you list your current credit commitments. Ones which will continue will be deducted from your income/borrowing power.

Ones you indicate will be repaid on, or before, completion will be ignored for affordability purposes. Don't be clever though. Lenders have a nasty knack of making it a condition of your mortgage that the things you say you'll repay you do repay.

Simply reduce the amount you intend to use as your deposit by the amount you need to pay off your credit commitments. The solicitor will pay it to you on completion.