Questions regarding new mortgage and current debt.

bradders33

Hi all,

After some brains to pick please!

Due to splitting up with my husband, I will have to sell my house this year. We have approx £100k equity in it, which we will obviously split 50/50.

I currently have £10k worth of personal debt, which I do repay each month, but would love to be free of.

I used a mortgage calculator out of curiosity a few weeks ago, to gauge an idea of what sort of mortgage I will be able to get on my own salary.

When I entered my debt figure, equity and salary, I didn't get any results from lenders. So I entered the debt as zero, the equity at £10k less (as it will have paid off the debt) and my salary and then got a load of great results back.

I think using some of my equity to pay the debt is a good idea, as it would save me almost £400 a month and enable me to overpay my mortgage going forward.

BUT, my question is, will a lender lend me a mortgage on the above scenario, effectively taking my word for it that I will use some of my sale proceeds to clear the debt, thus it shouldn't be taken in to account when assessing affordability?

I have Googled it and can't find the answer, but I know you clever lot will know.

Also, if lenders won't accept this, what are my options besides winning the lotto?

Thanks,
Bradders. x

Contemptuous

Lenders can make it a condition of the mortgage offer that the debt is repaid on or before completion of the new mortgage. The onus is then on your solicitor to ensure this happens.

bradders33

Contemptuous wrote: »

Lenders can make it a condition of the mortgage offer that the debt is repaid on or before completion of the new mortgage. The onus is then on your solicitor to ensure this happens.

Oh brilliant, thank you. With regards to the "the debt is repaid on or before completion" as the debt is with 3 lenders, I can't imagine that it would be possible for me to call the various lenders up and pay them over the phone mid-move! Is there some leeway on time frames do you know?