Overdrafts and Mortgages

Trebor2013

To any body who can help...

I've recently cleared my overdraft of £1650.00, within the last month, and will be looking to apply for a mortgage this week; following a decision in principle received from our mortgage broker and Halifax.

Will it go against us, when myself and partner apply for the mortgage, if either of us has been into our overdrafts within the last month?

Thanks.

Caladan

As long as it doesn't look like you're heavily reliant on your overdraft I wouldn't worry.

Thrugelmir

How frequent is the overdraft usage? As the history (last 84 months) will be visible on your credit record.

ValHaller

Thrugelmir wrote: »

How frequent is the overdraft usage? As the history (last 84 months) will be visible on your credit record.

7 years ????

Caladan

8 years does seem a bit excessive. But regardless, credit reports only show a "snapshot" of the history. I can't speak for all lenders but I know the company I'm with is only really interested in the last 3 months.

Trebor2013

Well the overdraft was being used each month, up until i cleared it, and i am yet to go back into the overdraft

Additionally, i will be saving approximately £300.00 following 2 credit cards and a loan being paid off; all of which have not got any defaults or missed payments.

As mentioned we've already been given a decision in principle, which states we can apply for a mortgage of upto £166,950. The property value is £180,452 and we're putting down a deposit of £46,000 (approx 26%). This would leave us needing a mortgage £134,000.

Is there anything that can be done to support the bank statements? We do not have any outstanding credit.

lawriejones1

To be honest, I can't imagine you will have any problems whatsoever. I had a lot of overdraft usage on my credit history, cleared up in the past 5 years although I currently have 2 loans. I've never missed a payment on anything an have been paying things off early as and when I can.

It's all about risk - if you have a good, secure and steady job with a reasonable credit history and a large deposit (which I guess 26% would be considered) you should be in a good place I would have thought...

amnblog

Provided you have been within your limits I would not expect use of the overdraft to be an issue.

Many clients are offered free overdrafts by their Banks and choose to use them as a result. That doesnt make you a poor risk.