Credit Checks & CC Debt - How Long to Clear

Melvyn

Im going to pay off my credit card debt in order to apply for a mortgage.

Does anyone know how long it will take to come off my credit record and do different card providers take different times to be removed?

I don't want to pay it all off and then get refused because its still on my credit history.

YorkshireBoy

Anywhere from a month to 4 months (with LTSB) in my experience.

But it shouldn't be a problem, as you could give the lender proof of payment, via a statement or printout of your recent transactions, if you're declined.

bengalknights

Give it upto 3 months usually to update as paid in full

guesswho2000

YorkshireBoy wrote: »

...it shouldn't be a problem, as you could give the lender proof of payment, via a statement or printout of your recent transactions, if you're declined.

Indeed, dependent on your earnings, debt to income, etc. it might not even matter that you have the debt - Nationwide didn't care that I had outstanding CC debt, although it was only about £2.5k.

YorkshireBoy

guesswho2000 wrote: »

...it might not even matter that you have the debt - Nationwide didn't care that I had outstanding CC debt, although it was only about £2.5k.

My only experience of (re)mortgaging with debt was with YBS, albeit a few years ago now, who deducted 36% (12 months of 3% minimum payments) of the debt from my salary before doing their sums.

Herbalus

Melvyn wrote: »

I don't want to pay it all off and then get refused because its still on my credit history.

I would have thought that most people would want to have their credit cards paid off regardless of whether they want to apply for anything else. Unless there is a reason for this. 0% deal maybe?

guesswho2000

Herbalus wrote: »

...0% deal maybe?

In my case, correct.

However, there are some other reasons I suspect, such as early repayment penalties on loans or whether repaying would leave a deposit shortfall (and therefore an increase in interest rate which works out greater than that gained by repaying, again true in my case).

Herbalus

guesswho2000 wrote: »

In my case, correct.

However, there are some other reasons I suspect, such as early repayment penalties on loans or whether repaying would leave a deposit shortfall (and therefore an increase in interest rate which works out greater than that gained by repaying, again true in my case).

The OP said it was credit card debt, so I doubt there are early repayment penalties, and I would hazard a guess that his cc interest rate is much higher than any prospective mortgage rate, unless it is 0% of course.

If it is as you suggest in your second point - that it would be more expensive to pay off the credit card as your mortgage would be more expensive - you are assuming credit card debt as the cheapest option available. To me that rings alarm bells (again, unless at 0%). Only he will know though.

Melvyn

Yes should have said all of it is now at 0%. Deposit interest rates are so low that its hardly worth offseting it any more so I will just pay it off.

I will speak to the broker to see what evidence of payment they might accept if it stays on your credit history for so long.