impact of other credit on mortgage application

slick_rick

Hi guys,

First time posting so please be gentle, and any advice would be greatly appreciated My wife and i are looking to put our house up for sale in the next couple of months in the hope that we can upgrade to a bigger family home. I was wondering how having other loans/credit cards impacts the amount we could borrow? Is it just as simple as taking the outstanding loans/credit cards off the amount we could borrow?

(We currently have 25-30k equity in our current house and are looking to buy a house for up to 200k. We have a joint income of 55k and have excellent credit scores. We have a credit card with 4.5k outstanding, and a loan with 4k outstanding. If we sell our house and get 25k out, and then put 20k deposit down on a 200k house it would leave things a little tight when factoring in moving costs, stamp duty, buying new furniture etc on top of the outstanding debts. Hope this makes sense).

kingstreet

Enter loan payments and card balances into lender affordability calculators and see the impact.

This will be much greater than your suggestion a £4,000 loan balance meaning you can borrow £4,000 less.

Thrugelmir

slick_rick wrote: »

If we sell our house and get 25k out, and then put 20k deposit down on a 200k house it would leave things a little tight when factoring in moving costs, stamp duty, buying new furniture etc on top of the outstanding debts. Hope this makes sense).

Perhaps wait until the situation eases. As it's affordability that really matters not what you believe your "excellent credit score" to be.