question for any mortgage advisors/IFA's

The_White_Horse

I currently have an off set mortgage. I am looking to move next year.

I have the balance between the original mortgage and what I have paid off availabe to me.

I have a car loan about to end, that has a balloon payment.

My question is, should I use some of the mortgage funds already paid to pay it off (and then increase my monthly mortgage payment) or refinance the balloon payment with a new loan.

The point being, am I better off next year when looking for a new and bigger mortgage to have a slightly bigger mortgage and no loans, or a slightly smaller mortgage but with a loan?

Do lenders even look at these things?

In numbers (not the real numbers, just for illustrative purposes) am I better off having a £100k mortgage and a £10k loan or a £110k mortgage?

* I am not thinking about interest rates at the moment - as I can work this out at the time - it is 99% certain putting it on the mortgage would be cheaper than a loan. Just concerned I give myself the best chance of obtaining the highest loan I can when I want to move.

Cheers.
TWH

The_White_Horse

39 views and not one person has any clue what lenders will look at when considering lending? (bump)

The_White_Horse

60 views now. I didn't realise I was asking such a difficult question. I thought it would be "yes, get a loan" or no, pay it from existing funds" or "do what you like, you owe what you owe and potential lenders don't care how it is split"

Oh well.

quidsy

what interest rates are you talking about on each product.

e.g. paying interest on 10k extra mortgage over 20 years is not worth it if your loan rate is low & can paid off in a year or 2.

You really are better off talking to a IFA.

The_White_Horse

cheers. i will pay off the loan or the extra on mortgage over the same time. it is purely what looks better on my record for lending purposes.

The_White_Horse

bump..........

Wh05apk

If you are tight on income, then having any sort of loan/finance will have a large effect on the amount you can borrow, generally better to clear any high rate credit, even if it means borrowing more.

The_White_Horse

cheers. I have no other loans (except for some on a 0% credit card).

as i said, my only concern next year (when I want to move) is that if I have a "loan" potential lenders will offer me less - that if I didn't, but had slightly less equity to put down on the new house.

GMS

A credit card will be taken as a commitment by the lender regardless of the interest rate. Usually 3 to 5% of balance as a monthly credit commitment.

The_White_Horse

can lenders actually see these loans and credit cards or do they rely on you telling them the truth about them. Not that I am trying to defraud them, just interested to know if they actually know.

Wh05apk

The_White_Horse wrote: »

can lenders actually see these loans and credit cards or do they rely on you telling them the truth about them. Not that I am trying to defraud them, just interested to know if they actually know.

Yes, when they run a credit check, it will show every piece of credit you have, along with how you have conducted it,