Does shopping around for mortgages affect credit file?

Hairymonster

So my wife and I are looking into buying a new house. We should have about £30k for a deposit and looking for a mortgage about £250-300k.

I am wondering if we were to shop around for different mortgages would it affect our credit file?

The reason I ask is that in the past I had a very poor credit file- all stupidly self inflicted of course... But Over last few years it has improved quite a bit with me always clearing credit card and not running into problems but it's still not amazing. My wife has a very good credit score and file.

I think my bank(barclays) is possibly the best option for me as recently my current account is showing I'm pre-approved for £3.5k overdraft and £35k loan. Not interested in either offer but think it might be an indication of improvements in my file with them.

BUT on the other hand we will want the best rates and terms possible... Does shopping around and being given an offer (interest and terms) affect your file if you get several from different lenders? The same way applying for multiple credit cards does?

aero1

Hi Hairymonster!
if you go through a mortgage advisor and they do the initial searches then it has no impact. That will give you a good idea of who you can apply to, rates etc.
Once you decide to actually apply though to a specific lender, then yes that will show up and you will lose points on your score.

If a search does show up on your report it will reduce your score for up to 6 months, with the effect it has reduced it by getting less each month.


Hope that helps!

Thrugelmir

Hairymonster wrote: »

BUT on the other hand we will want the best rates and terms possible...

Then save for a larger deposit or reduce the amount you wish to borrow. As what you are suggesting to borrow is going to have an impact as to what's on offer.

DCFC79

Your wife's credit score and yours will be about as useful as 2 digestives to broker.

dancingfairy

I think it depends whether the lenders do a soft check on your or a full one (that used to be the case,I'm not sure since they bought in the new affordability tests whether they still do soft and full searches).
This suggests that Decisions in principle/agreements in principle are registered as soft searches but not full ones: http://blog.homes24.co.uk/uncategorized/2013/12/five-step-guide-to-the-mortgage-application-process/
As someone above said I would consult a whole of market broker who can assess your situation and give you a good idea who is likely to accept you (this would be even more helpful if you have a less than perfect history).
Good luck
df

Malmo

Whether it's a soft or hard search/check for the AIP/DIP depends on the lender. For example, Halifax is a soft while Santander is a hard. Brokers will know which do which.