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Mortgage application with credit cards
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mpgsheep
Posts: 247 Forumite
Good afternoon,
I signed up for a 0% for 18months credit card 3 months ago, with the intention to stooze, so I started a first direct regular saver to run at the same time. Now we are looking to move house, and of course apply for a mortgage. What I am wondering, is does any money we have on the credit card impact on the mortgage application? (ie likely we have £900 saved, and £400 on the card).
I signed up for a 0% for 18months credit card 3 months ago, with the intention to stooze, so I started a first direct regular saver to run at the same time. Now we are looking to move house, and of course apply for a mortgage. What I am wondering, is does any money we have on the credit card impact on the mortgage application? (ie likely we have £900 saved, and £400 on the card).
Opening Mortgage balance as of 01.10.21 - £438,500.00 Current Mortgage balance as of 01.11.24 - £409,492.24
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Comments
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Any credit card balance to remain after the mortgage will be taken as a credit commitment, typically at 3% per month and will reduce the maximum borrowing.I am a Mortgage AdviserYou 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.0
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ok so it makes sense to make sure I have a zero balance on my credit card when making my application then?Opening Mortgage balance as of 01.10.21 - £438,500.00 Current Mortgage balance as of 01.11.24 - £409,492.240
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Assuming you already have enough for arrangement/booking, deposit, legal fees and other moving expenses I would just pay it off.
It just looks better if you have no debt (even though £400 is hardly going to worry many underwriters).
If you want to stooze it will be easy in future to get a 0% on purchases card and get back in debt on monthly expenses should you wish.0
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