worrying in advance of applying for my mortgage!

charleyroo

Hi all

I am applying for a mortgage with Nationwide on Monday (my existing mortgage is with them). Starting to panic, possibly being paranoid, as have been £1-200 into a £750 overdraft on occasion the past 4/5 months as have been trying to quickly finish our house to sell it as well as a lot of additional outgoing expenditure paying for our wedding and of course Christmas which left us having to use my overdraft to pay for the housey expenses..

I will not go into my overdraft again (have not been in it since beginning of Jan) but worried the lender is going to be disapproving.

£35000 salary
£69900 current mortgage
£141000 total new mortgage (HTB, £92 a month interest after the 5 years)
£2000 outstanding on credit card (I plough all expenses through my cards for the airmiles and because of lots of hols, wedding stuff and other bits I pay about £1500-1800 through my card per month)
2 credit cards open, one with 5000 limit and one with 3500 limit. Also an open store card with 5000 limit but none used.
No other loans or finance.

My partner and I pool our money but due to partners previous poor credit I deal with all financials and own our house.

How is Nationwide going to view me? My broker has said my affordability points to max 161k mortgage, if I leave the credit card debt I guess it will be around 155k.

Or am I better off paying the 2k debt (wanted to keep the cash as additional towards the move) to try and present myself as squeaky clean as poss? And should I close my Next account for now?

Appreciate any advice or reassurance!

charleyroo

Forgot to say, I've been in my Nationwide Flex overdraft but have a current account with Natwest which I use for my daily expenses, this has no overdraft.... would I be better off presenting these bank statements or will Nationwide just use my Flex acc as evidence of account conduct?

NW wrote to me last week trying to increase my credit card limit so I guess/hope they do like me, credit wise?

charleyroo

Oh, and I have gone back into credit every month on payday, it has sometimes gone into the planned OD latee in the month.

Thrugelmir

charleyroo wrote: »

£2000 outstanding on credit card (I plough all expenses through my cards for the airmiles and because of lots of hols, wedding stuff and other bits I pay about £1500-1800 through my card per month)

What will be apparent to the lender is your dependence on your partners income (who isn't party to the mortgage application). The mortgage is unaffordable on your salary alone. Given your spending habits which reflect your lifestyle.

The overdraft usage won't help either. The reasons for it are of no consequence. However it will be apparent that you've a lack of savings.

I would suggest a few months getting your house in order. Before committing to an even greater financial burden.

Your partner will be factored in as a dependent even if not named on the mortgage.

charleyroo

Thanks. Have to admit that the partner dependency thing is news to me. Last time I was applying for a mortgage, we pooled our money as we do now, and I submitted all my bank statements, and was not asked about partner salary etc.

We do have some savings ready for the move now that the house is finished. Agree my spending habits aren't perfect, but we pretty much just spend what we have available, aside from overpaying the mortgage... hence no loans or other financial commitments.

Do I have too much credit available and so should close an account? I had a DIP approved for 145k a few months ago with NW so am loathe to change anything drastically to try and help myself unless it really is the right thing to do.

Slightly glad I have a broker for this one

Thrugelmir

The financial world has changed and has yet further to go. With incoming financial conduct rules placing obligations on lenders to fully assess affordability and lend responsibly. Net result is that lenders will be extra cautious and viligant.

charleyroo

Thanks Thrugelmir as always

tigsly

we were offered 300K less when we went for a mortgage in principle in 2013.. than we were when we applied in 2006.

We have a higher level of savings and earnings now than then.. and have no 'bad credit'..

charleyroo

Hi Tigsly, i can understand there being a difference between 2006 and 2013 as there's been a boom, bust and recession in between!

My last DIP was in October 2013 as far as i remember (can't see it on Noddle!), I hope my lenders view hasn't changed too drastically since, although as Thrugelmir has alluded I expect things will change as we near the Lending Regulations change.

Thrugelmir

charleyroo wrote: »

Thanks Thrugelmir as always

Don't despair though! Adapt to the new world yourselves and you'll achieve your dream.

charleyroo

Haha, indeed. If all goes well with this mortgage we will be buckling down financially - no excuses really, we should have lots saved by now. We just thoroughly enjoyed the last year or so instead. If we don't get this mortgage, we'll reign in anyway to try again in the future.

I will update this thread when I know what NW are going to do with me!!