Mortgage Yes or No?

marshmallowkisses

Hi all

New to the whole mortgage thing and haven't posted on here for a while. Myself and partner have been saving for a deposit for a wee while and have just found a fantastic house at £140,000. We have a 5% deposit in place and are hoping to go with Clydesdale for their 90-95% deal. How probable do you think it is that we'll be accepted?

Deposit £7,500
Property value £140k

Salary combined £51k per annum (both of us get a pay rise this year but TBC - however I am aware this wont be accounted for now).

I have 2 credit cards, all paid more than the min payment every month (approx £900 balance on each). I have an overdraft of £650 which I have reduced from over £1k over the last few months. I do go into this every month.

Partner has 1 credit card which is approx £900 and paid off on time every month (min payment). He has an overdraft of £350 which is dipped into every so often, but never over overdraft.

Just want a bit of information regards how probable it is we will be accepted

Be gentle! MMK

Thrugelmir

We're a friendly bunch really. So take no offence to comments posted.

First clear your debts from your savings. Secondly stop using the overdraft facilities you have. Thirdly learn to budget, i.e. spend what you have available.

Lenders will be looking at people who have a squeaky clean credit history and can manage their finances well at a 90% plus LTV.

marshmallowkisses

Thanks for the quick response. The problem is we have found a home we don't think well ever find again! Do you think it's completely out of the question?

I was under the understanding that we have shown we can manage our finances by paying current credit arrangements on time etc?

bigadaj

marshmallowkisses wrote: »

Thanks for the quick response. The problem is we have found a home we don't think well ever find again! Do you think it's completely out of the question?

I was under the understanding that we have shown we can manage our finances by paying current credit arrangements on time etc?

By all means try, but if you do get knocked back then don't go mad, alternatively try a broker who might be able to place you with an appropriate lender.

There ae always other houses anyway if you are unsuccessful.

They key things for now are to make sure you pay above the minimum on your cards and have a plan to clear them in a reasonable time period. Also make sure you get and keep out of your overdraft.

marshmallowkisses

Thanks very much. I guess we just need to bite the bullet and go for it - you are right, there are other houses out there. And as my mum would say, "whats for me won't go by me."

Anyone who has had overdraft/credit card and got a mortgage - would be good to hear from you from your experiences? I don't think I'm in that bad a position?

maninthestreet

With a combined income of 51K, where is your money going such that you both need to make use of an overdraft?

Radiantsoul

marshmallowkisses wrote: »

Thanks for the quick response. The problem is we have found a home we don't think well ever find again!

Have you though? There is probably a house next door to it that is very similiar. It is nice to fall in love with somewhere, but rationally there will be other houses even if this one doesn't work out.

Let_Us_See

Lenders are careful at 95% LTV. However, if the property means that much then stop procrastinating and get an AIP/DIP completed. You may get a nice surprise, or if declined, will it really be the end of the world?

Building_Surveyor

Using an overdraft every month is not going to be a good sign to any lender. You need to show you are living within your means so dipping into your overdraft every month isn't going to impress them. Maybe at the lower Ltv you would be fine but when your asking for 90-95% mortgages, what you and I may call a small issue, it's just makes it easier for the lender to filter off less desirable applications.

To be fair if I were you I wouldn't be asking if I could get a mortgage. I'd be asking about budgeting and get that in order first. Even if you did get the mortgage, do you still want to be living in your overdraft then ?

lawriejones1

Going into an overdraft means very little to lenders. £100 here or there won't raise an eyebrow, but I agree that a bigger deposit could help answer any difficult questions.

Our household income tops £72,000 and we use our overdrafts and credit cards. Didn't matter to the lender.

Building_Surveyor

The OP stated that her overdraft was used every month.