Applying for a mortgage, should I wait to get a new credit card?

Moclin

Hi

I am applying for a mortgage around September/October time and I wouldn't mind applying for a new credit card next week that has a better limit than my current £500.

Reason I want a bigger credit limit is for security for when I do get a mortgage - last resort emergency funds.

My credit score is around 900 so I think I stand a good chance of getting accepted but it still goes down as a credit search on my credit history.

I'm wondering if this is a wise move and if the this would affect my mortgage application in 3/4 month time positively or negatively?

Thanks in advance

StuC75

Do completely disregard your credit score it means very little, its onl a guide at best..

Often the rule is to avoid new applications at the same time - particularly as any regular payments will then affect affordability.. But as this is to have as a precaution then its impact is questionable..

A bigger concern may be why the current credit card only as £500 limit? How long have you had that account? is its conduct in order? could you not ask them for a higher limit?

Moclin

Thanks for the reply StiC75. I've had the credit card for over 2 years now, back when I had a poor credit rating and very little credit history.

Now I have a good credit history with every single payment paid on time and in full - no late payments, ever.

I did ring them to ask for a higher limit last year but they said I wasn't eligible. I'm thinking of getting the Santander 123 credit card for the cashback benefits.

What do you reckon? Apply now?

JakeGreen

Apply as soon as possible so that you don't apply within 3 months of the mortgage application. Ideally you want at least 6 months before the mortgage application but with 1 search you should be ok.

Moclin

thanks Jake. Think i'm going to apply this weekend. It will probably be closer to Christmas when we apply because I can see us being picky about the house we want so I think the gap in between credit searches will be over 3 month at least.

jamesml

Other thing is that from what I have read you will be less likely to be accepted after having got the mortgage - particularly with a new address where you have only just moved apparently.

sfax

jamesml wrote: »

Other thing is that from what I have read you will be less likely to be accepted after having got the mortgage - particularly with a new address where you have only just moved apparently.

This is true. You probably won't be able to get a new credit card just after you've moved house - or may experience issues. You may have to at least wait until the electoral roll is updated on all your credit reports (could be 3-4 months or more). I would always advocate applying before (and have done exactly that in the past). An extra credit search will make no odds to a mortgage application.

Moclin

Great - thanks people! I've made my decision

sirwiggum

You mentioned you had poor credit in the past, a Santander card can be difficult to obtain (I've tried and I've been banking with them since the Alliance and Leicester days!).

Use something like noddle to make sure there are no defaults etc still listed that may affect credit card / mortgage applications.

I too had a high credit score with experian. It means nothing. Noddle rates me as 3/5, a 6.5yr default to my name, can't get a loan or a credit card beyond 500 quid.

Experian_company_representative

I just answered a question on the Experian website on applying for other credit in the run-up to a mortgage. Sounds like you've got it all sussed though. Good luck!

James