So worried about mortgage application

Florence26

Evening All

I was wondering if anyone would be able to help me.

To outline the facts:
- we've sold our house (STC)
- we've found an amazing house and had an offer accepted on it
- we've worked out we have between a 25% to 30% deposit for the new house (our own house is under final, sealed bids at present so final selling price isn't yet known)

I've been very foolish with money - spending above my means consistently over several years. I've therefore amassed CC debt of £11k. I'm finally out of my overdraft, but only since March (after several years). I've never defaulted but I do have a couple of late payments on my file - not recently - but 2 years ago.

My husband has no CC debt and has no idea about my CC debt as I'm too ashamed to tell him.

We have a great combined income - both work full time - bring in well into the six figures. Affordability is fine....I'm just concerned about my higher than desired level of CC debt.

I checked Equifax and Experian for my credit score - I'm excellent in one and good in another.

My questions are:
- do we have any hope of getting a mortgage approved?
- can we go to a high street lender, or should we use a broker?
- I know I should come clean to my husband....and I will in time. But do I have to do this before we apply for a mortgage?

I feel sick with worry - the deception, the potential rejection by a lender etc. I am really hoping someone can help me with some practical advice.

Thank you if you got this far!!

ACG

Something similar came up the other day regarding whether the debt should be disclosed to the partner or not.

If you go directly to the bank, you are both going to sit there whilst the "advisor" submits it there and then.

If you go to a broker, you can book the appointment in and explain the situation before he/she goes through the factfind so as not to disclose it in the meeting. Its happen to me before (with life insurance, where applicants have called up to tell me about STIs they have had but not told their partners about).

As for whether a mortgage is possible, without knowing the figures for purchase price/deposit/loans etc its difficult to say.

Florence26

Thanks ACG - that's useful to know.

To put some figures against the problem.
Sold price (probably) £230k
Purchase price £395k
Deposit net of stamp duty is likely to be £115k
CC £11k
No other loans or overdrafts (since last month)
Salaries £120k+

Thanks again

Florence26

Oh - on my credit file are a few store cards etc. But these are all fully paid. Credit files say I'm using 53% of my available credit. I have no idea if this is good or bad.

DebtFree14_2

Hi

I don't mean to be the devil in this situation but you have a combined income of £120K and are worrying about an £11k credit card? Something doesn't sound quite right but thats your story.

My advice is tell your partner and instead of paying a deposit of £115K pay £104K and pay of your credit card. Why would you have the stress of the cards and worry about hiding it from your partner.

If I earn't a salary of £120k and my wife said she owed £11k I would probably be in a mood, maybe sulk for a few hours and demand massages every night for a year but I certainly wouldn't finish the relationship.

You will get caught out with a broker or in the bank. They will do an affordability calculator and ask for all debts and outgoings. Trust me, trying to hide this is more stress then you need

ACG

From an affordability perspective you should be ok.

ACG

DebtFree14 wrote: »

You will get caught out with a broker or in the bank. They will do an affordability calculator and ask for all debts and outgoings. Trust me, trying to hide this is more stress then you need

I disagree. If you explain the situation before meeting up, it can be kept discreet.

Florence26

I know what you mean DebtFree14 - it's a bit nuts. You are of course absolutely right that we should use the deposit to pay the card. I'm just so ashamed I've racked up that balance.

We have separate finances and a joint account for expenses. I pay my fair share of everything....but I've overspent historically.

The £120k salary is combined.....worst thing is I'm the main bread winner too. This just adds to my mortification.

Florence26

Hello All. I just wanted to update this incase anyone else is in a similar situation.

I went through a broker - initial meeting was on my own (they then went on to meet my husband separately) - and I was very honest about my situation and that I didn't want to have to tell my husband. We went through all my credit reference reports and he helped me to put it into perspective.

Meanwhile, I told my husband that I had "some" debt - I didn't go into details. He asked me if I wanted to use his savings to pay it off. I said I didn't as it is my mess and I'm dealing with it. He wasn't happy but understood my stubborness....

We applied for a Nationwide mortgage (existing customers), got a DIP straight away, provided all our relevant paperwork, broker did the full application and we got our offer yesterday.

I'm aware this can be revoked up to completion, but if anything, my situation has improved since we applied for the mortgage - more debt has been paid off, etc.

All in all, I'm now sleeping better at night!! I'm on track to be debt free this year and will not be going back to my old ways again. My husband and I are more aligned on financial issues (albeit he doesn't know the exact amount of CC debt I'm in.....)

Thanks for the initial advice - especially telling me to see a broker

ACG

Great news. I wont say congratulations as that is tempting fate but best of luck.

exoteric

Florence26 wrote: »

Hello All. I just wanted to update this incase anyone else is in a similar situation.

I went through a broker - initial meeting was on my own (they then went on to meet my husband separately) - and I was very honest about my situation and that I didn't want to have to tell my husband. We went through all my credit reference reports and he helped me to put it into perspective.

Meanwhile, I told my husband that I had "some" debt - I didn't go into details. He asked me if I wanted to use his savings to pay it off. I said I didn't as it is my mess and I'm dealing with it. He wasn't happy but understood my stubborness....

We applied for a Nationwide mortgage (existing customers), got a DIP straight away, provided all our relevant paperwork, broker did the full application and we got our offer yesterday.

I'm aware this can be revoked up to completion, but if anything, my situation has improved since we applied for the mortgage - more debt has been paid off, etc.

All in all, I'm now sleeping better at night!! I'm on track to be debt free this year and will not be going back to my old ways again. My husband and I are more aligned on financial issues (albeit he doesn't know the exact amount of CC debt I'm in.....)

Thanks for the initial advice - especially telling me to see a broker

Thanks for the update Florence, it's great that everything worked out. Which lender was it? Presumably they weren't put off by your high debts?

One question though - surely your debts would have been declared on the mortgage application form and your husband would have seen or been entitled to see a copy of the final application form before or even after it went in?