FTB - credit cards & bank accounts

Nine_Lives

If all goes to plan then we'll be FTBs in 2013.

We're aiming at a 40% deposit. Probably going to come in a little under that actually at maybe 38% as we had targets to hit this year. I hit mine but unfortunately the missus was some way off hers.

I was just wondering how much of an effect credit cards & bank accounts can have when it comes to getting a mortgage. Before you respond though....

We each have credit cards & use them for stoozing. I have more than the wife & neither of us have any late payments or debt to our name.
She has 2 - a Sainsbury's one for the double Nectar with a £500 marker & a Tesco one which will be paid off & closed by the time we apply.

I have a M&S with £4k limit which will be paid & closed by the time we apply. I have a Halifax with a £2k limit which will also be closed, i think, by the time we apply.

I have a Sainsbury's (double Nectar) with £500 limit & a Santander 123 card with £500 limit which i use (& my wife, mother & sister too) for the cashback.

So all will get paid off & closed down. What about the Sainsbury's & Santander cards though - £500 limits on each - can/will these go against us negatively?


Also, i must have about 20-30 accounts, mixture of bank & savings accounts, to my name. They're all 'working (example: The Santander Preferred accounts offer 5% on up to £2,500 & you're allowed 2 - i'd like to dump all my money in there, but both have £2,500 & the rest of my money is split elsewhere).

When we come to apply i'd love nothing more than to consolidate it all. Could so many accounts again go against me?



Sorry if the questioning is silly, basic, or the answer is obvious to some - but it's all new to me.

rb10

I am in a very similar position to you. It's a good question, and, particularly, for a first mortgage, important to get it right!

Regarding the Stoozing, I found this article to be very insightful.

I have stopped stoozing in the past few weeks, and, like you have paid all CCs off in full. This will take a month or two to show up on my Credit Report, which is shortly before the time I anticipate applying for a mortgage.

Having two cards with a small/zero balance is not likely to count against you in any way. I'll still have several thousand in limits when I apply for my mortgage (but only a small outstanding balance).

Regarding the savings/bank accounts, ignore anything that's a savings account. It won't show up on your credit report, so your mortgage lender won't know that it exists.

Bank accounts - I think lenders only really care if you are actually overdrawn. If you don't even have an arranged overdraft limit then it's certainly of minimal interest to them.

Ultimately, your actual debt at the time of application is far more important than the limits that you have available.

Nine_Lives

Thanks very much for the reply. Very helpful.

With the overdrafts - i don't have any. Any accounts that auto-come with overdrafts i remove them straight away as i never need to use them.

Interesting helpful article on the stoozing too.