Overdraft usage -- Impact on mortgage?

socookin

Hi All,

Thanks,

Mortgage_Mark_2

If agreed and you haven't gone over the limit, then it will have no adverse effect. It's simply a credit commitment that you are using and repaying on time.

I'd be amazed if you had any problems because of it - it's a bit like having a credit card and paying it off every month.

ELToro

I am in a similar spot I am waiting for a current bank statement (only asked for 1) to show my outgoings as the one prior does have a heavy usage of my agreed overdraft but has been clear the last 20+ days now.....

Had the survey and the credit score agreed I am just holding up no on this part. I know it doesnt help but I am just doing it to be ultra safe.

ChaddyBouy

I was often in my agreed overdraft, as long as you go into the black as such once you get paid my lender didn't seem to mind.

Thrugelmir

Lenders will assess on you what they see, i.e. your past 60 months reported history. Whether you have other unsecured debts was also be taken into account.

Senior_Paper_Monitor

Lenders consider overdraft use within their overall assessment of your risk profile - some ignore it almost totally, some look at worst case within a period (say 3 months) and allocate that amount into the affordability calculation, some weight this item heavily, some do not, in terms of impact on the profile.


I can think immediately of 2 lenders that react very badly to 'living in overdraft' and several who almost don't care as long as it is run within limits (and overall credit availability is not zeroed due to overuse).


What you have described seems unlikely to be a problem for the very great majority of lenders.

CaptainPete

Can I ask which lender it was that asked for 4 months of bank statements?

I've been keeping my accounts very "frugal" for the past few months with the hopes this will increase the amount on offer and was planning on applying for a mortgage soon with 3 "good" months under my belt .

Wondering if I should leave it another month so I've got 4? I was planning on going with either Santander, Barclays or possibly Virgin Money.

Thanks,

P