Mortgage Application: A Rambled Question

turboshandy

Not to bore people with my financial misgivings of the past but I have something of a chequered history with my finances although have worked hard to repay almost all of my debt, having not missed any payments for the best part of 7 years now.

My Wife's Grandmother recently passed away and we have been given first refusal of buying her house at a heavily discounted price, far too good an opportunity to turn down. We have been offered a mortgage in principle, subject to further credit checks. I have checked On Experian and they have my score as "Excellent" (999 points).

All very exciting but what's playing on my mind is not so much the one credit card I have left (the balance left on it is negligible and will be clear by Christmas) but my overdraft. Again, it's not a huge amount on it but I'm not sure if it will be looked upon unfavourably when the proper application is processed. I've been paying a bit off every month for the past few months and, again, it should be clear by the end of the year. I do use it on a monthly basis though. Interestingly, the overdraft doesn't actually show up on the Experian report.

In my mind, this whole situation has arisen just two or three months too early from my point of view, is this overdraft likely to affect our application, considering how close I am to actually paying it off?

Mortgage application is with Halifax if that makes any odds.

Thanks for reading.

Foxy-Stoat_3

Credit score from Experian or similar means nothing.

Whats your deposit level?

Are you in a positive balance when your wages go in?

I would transfer the overdraft to a low interest credit card and cancel the overdraft moving forward. Burn the card and pay it down.

Talk to a broker to get you the best deal if Halifax's computer says "no".

turboshandy

Foxy-Stoat wrote: »

Credit score from Experian or similar means nothing.

Whats your deposit level?

Are you in a positive balance when your wages go in?

I would transfer the overdraft to a low interest credit card and cancel the overdraft moving forward. Burn the card and pay it down.

Talk to a broker to get you the best deal if Halifax's computer says "no".

Thanks for taking the time to reply.

We are sitting with a 10% deposit, thanks to the low asking price for the house.

My wages cover the overdraft and then some, at the point of my wages going into the account, I reduce the overdraft by £200 but always end up having to use it to it's (new) limit.

I wasn't sure about applying for yet another card to transfer my balance to, didn't want saddled with too many applications for credit in a short space of time, especially if the first mortgage application is unsuccessful.

Foxy-Stoat_3

I was suggesting about using a current card, if its low enough that is....agree not good to apply for credit so soon before your mortgage. By the sounds of it your OD is pretty low and the lender should see that it will be paid up in a few months.

10% is the minimum level so as you have a good credit record for the last 7 years you have a good chance with a reasonable rate.

turboshandy

Foxy-Stoat wrote: »

I was suggesting about using a current card, if its low enough that is....agree not good to apply for credit so soon before your mortgage. By the sounds of it your OD is pretty low and the lender should see that it will be paid up in a few months.

10% is the minimum level so as you have a good credit record for the last 7 years you have a good chance with a reasonable rate.

Ah right, I see what you mean. The sensible voice in my head told me to cut up/cancel my cards once paid off so only have the one left with the small balance on it.

As I say, at my current rate of paying them off, they'd be clear by the end of the year so hopefully that will be taken into consideration.

Thanks again, I was just really looking for a bit of reassurance, which I now have.

Foxy-Stoat_3

No worries, but it would make very little difference what I or anyone else posts...its really down to Halifax. When I applied and secure a mortgage with them I had a few thousand pounds of credit card debt that I was paying down and it made no difference as my salary was well within limits but I had to drop 22% down rather than your 10%....so its all treated differently I guess.