Taken out credit card after mortgage application...

s1m0ne

I am having a squeaky bum weekend too...

Looks like I've done something stupid as well. While I was applying for a mortgage I bought an iPhone 5; nice phone, but.... My credit score was "good" on Experian until yesterday. The mortgage offer came through early this week, but then yesterday I got an email alert from Credit Expert, opened my report, and now my credit score has gone down to "fair" on the basis that I have a new credit account. Which is the O2 contract.

My legal paperwork has exactly the same paragraph in it, Knollys, I think we might be using the same conveyancers I seriously did not think a mobile phone could have anything to do with a mortgage or credit scoring..... Now I'm really worried that the bank may withdraw my mortgage offer because of a low credit score. I'm nowhere near my affordability ceiling, but the loan is large enough for me to have a dedicated underwriter (which my broker said was good). My main concern is that for that amount of a loan the bank might have extra strict requirements in terms of creditworthiness. Asked the broker, and he said that nobody knows how banks' scoring software works.

Does anyone here have any experience with anything like this? Any advice will be appreciated. I'm exchanging and completing next week. Obviously, a new phone contract does not materially alter ones financial circumstances, but after reading all the internet forums such as this, I am so paranoid I could hardly sleep last night!

kloana

s1m0ne wrote: »

I am having a squeaky bum weekend too...

Looks like I've done something stupid as well. While I was applying for a mortgage I bought an iPhone 5; nice phone, but.... My credit score was "good" on Experian until yesterday. The mortgage offer came through early this week, but then yesterday I got an email alert from Credit Expert, opened my report, and now my credit score has gone down to "fair" on the basis that I have a new credit account. Which is the O2 contract.

My legal paperwork has exactly the same paragraph in it, Knollys, I think we might be using the same conveyancers I seriously did not think a mobile phone could have anything to do with a mortgage or credit scoring..... Now I'm really worried that the bank may withdraw my mortgage offer because of a low credit score. I'm nowhere near my affordability ceiling, but the loan is large enough for me to have a dedicated underwriter (which my broker said was good). My main concern is that for that amount of a loan the bank might have extra strict requirements in terms of creditworthiness. Asked the broker, and he said that nobody knows how banks' scoring software works.

Does anyone here have any experience with anything like this? Any advice will be appreciated. I'm exchanging and completing next week. Obviously, a new phone contract does not materially alter ones financial circumstances, but after reading all the internet forums such as this, I am so paranoid I could hardly sleep last night!

Probably not a big deal. Your CRA score/rating can be highly arbitrary. More important is the size, type and conduct of your credit commitments. You'd be expected by your mortgage provider to have a mobile phone, and opening a fresh contract every 1-2 years is extremely common. Presumably you had a mobile contract already, at the point of application, and affordability was fine? I have 3 contracts - I took two out for close family. I wrote a note to the underwriter to point out that I receive regular payments into my account to cover these costs. Turns out it wasn't even an issue.

s1m0ne

Phew, picked up the keys yesterday. Good luck, Knollys!

Knollys

Picked the keys up yesterday so all worked out for us too - we did cancel the credit card straight away.

Clearly it was a mistake however the question was asked not for peoples wisdom or to raise a debate on the rights and wrongs of mortgage applications but for an answer to the question.

Some of the replies were v. helpful so thanks to you guys.

Good luck to all FTB'ers, do all you can if you know you can afford to pay back your loans :beer: