Effect of credit card balance on DIP

Car1980

Planning on applying for a Decision in Principle with Nationwide this month, but was wondering what the tangible effect of the amount of credit card balance would be?

Their online calculator is a nonsense (they'll apparently lend £148k with zero outgoings and it plummets to £85k when you simply plugin £200 a month outgoings - not that it even explains what constitutes an outgoing).

Applicant 1: £1400 cc balance
Applicant 2: £300 cc balance

We can go £500 into our overdrafts to get it down a bit this month - would it be better to get it down to £1200 / £0 or £900 / £300?

By the time it comes to the actual application it'll be completely zero for both of us anyway.

lee111s

Don't use your OD. What's the point in paying debt with debt? You're in the same overall amount of debt so it'll have the same effect.

If it'll be zero when you apply, input it as zero. Do the application based on where you'll be at the time you apply, not as yout situation is now as it's largely irrelevant.

kingstreet

If the commitments will be fully repaid on or before completion of the new mortgage, you do not need to enter them in the affordability calculator, so the impact on what you can borrow will be nil.

It is only ongoing commitments you will have to pay after the start of the mortgage which count.

Car1980

Great, thanks.

My broker's going to check over it all before I click submit anyway (I'm having to go through Nationwide direct since I'm looking to port my current mortgage with them)

kingstreet

We do Nationwide ports for our clients all the time.

I don't know why your broker thinks he can't do it. It's a paper app, that's the only difference.

Thrugelmir

Car1980 wrote: »

Their online calculator is a nonsense

Only intended as an indicative guide. Simply not possible to account for every single permutation of income and expenditure.