Should I change my credit card before mortgage application?

greybear40

Hi there. I hope someone can advise me on what is best to do. After many years of very poor credit all defaults and ccjs are now off my credit file and I have good credit again. Looking to remortgage in July to remove my ex husband from my mortgage and bring my partner in on the mortgage. We are spending the next few months improving our finances so we are as morgage ready as possible and we are paying off as much as possible. My question is I currently have a Vanquis card with a balance of £1400 on which is costing me a fortune in interest and was thinking of transferring the balance onto a 0% credit card so what we are paying actually makes some difference. Would this make a difference to our mortgage application as neither of us have purposely applied for credit for at least 6 months and I wouldn't want the mortgage to get refused due to a recent credit application? Any advice would be gratefully received thank you

YorkshireBoy

Move the balance ASAP, and close the other account.


That way, you're presenting the mortgage people with the same level of debt, a recently settled account, and one(?) credit search in the last 6 months.

Hazzinho

Depends how long until you apply for a mortgage, should you get the card there may be overlap for a month where the balance on your credit file appears for both your cards which looks like you have double the debt. One credit application won't have much impact.

greybear40

I was hoping that would be the answer! Paying Vanquis £100 a month which is over the minmum payment and they're taking around £50 in interest. It served a purpose when I had poor credit but now I feel I should be able to get back with a mainstream lender. Any recommendations of the best card around at the moment? I only work part time as my partner is the full time worker so obviously not something like platinum. Probably earn around £7000 a year. Also one that is fairly easy to get as even though my credit is now good I still feel like I'll always be turned down

greybear40

Looking to get the mortgage in July Hazzinho but don't mind waiting another month until Vanquis shows as cleared if that improves the situation

YorkshireBoy

greybear40 wrote: »

Any recommendations of the best card around at the moment?

Does your bank (the one that receives your salary) have a decent BT card? Other than that, you may struggle in getting a) a card, and b) one with a decent limit with your £7K PT income and £1.4K debt. One last option would be to shift the debt to a card in your partner's name.

greybear40

We both switched bank to the Halifax around 14 months ago now so maybe we should try them? It is Halifax we will be going for the mortgage with through a broker as my partner is an ex bankrupt (drops off his file 18 June as will be 6 years then) as our mortgage advisor has told us that Halifax now only want to know if you were bankrupt in the last 6 years. This is why we are waiting until July. It also gives us time to save for solicitors fees for new deeds and all application fees. Maybe if one of us had a credit card with Halifax too that would help the mortgage application? My partner has had no problem at all getting credit in last 2 years or so considering he is bankrupt, I have had more problems when I had defaults which is crazy!! His annual in come is around £23000.

greybear40

Well after careful consideration I tried with my own bank Halifax. Instant decline! Which is a bit worrying considering our broker thinks they will be our best bet for our remortgage! Hopefully as that is a joint application on 2 wages and there's loads of equity in the house that will be ok? Do you think its' probably best not to try another application with a different lender due to multiple searches?

redcard

greybear40 wrote: »

Paying Vanquis £100 a month which is over the minmum payment and they're taking around £50 in interest. It served a purpose when I had poor credit but now I feel I should be able to get back with a mainstream lender.

I think you misunderstood the concept of credit building.

You don't use a Vanquis card to get into debt you can't afford to pay back.

greybear40

I've had it years and yes I used to use it a lot and they kept upping it and ended up with £3000 credit limit. I have completely changed in last 3 years and haven't touched it for years but obviously the damage was done and have been slowly chipping away off the balance since it was last used. I can easily afford to pay it back its just the interest that's so extortionate! I am so much better with money now that I used to be and don't use credit now. Use my debit card for everything now but am still paying for my mistakes. Will get it cleared in next couple of years just will take longer than if I could transfer it to a 0% card. Already half way there

Thrugelmir

Lenders can now see 0% balance transfer accounts. For a mortgage clear the debt is the best advice. Not only in terms of obtaining the mortgage but to improve your own finances as well.