We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Changes to current accounts/credit cards affecting mortgage chances - please help!

Options
All being well I will be applying for a mortgage at some point this year (though how soon that will be I'm not entirely sure right now). I've been reading quite a bit of (sometimes conflicting) advice on what you should/should not do in the run up to applying for a mortgage, and was hoping for some advice on my current situation:

In December of last year I switched current accounts (closing my previous one), transferred my ISA and opened a new savings account and credit card (all with the same bank at the same time).

Just this month I have closed my other credit card (as it provided no real benefit and after a string of bad customer service) and have opened a new one.

I am currently saving £500 a month to a 5% saver and £200 to a Help to Buy ISA. I will likely be selling shares prior to applying for a mortgage, and had concluded that the best plan for this money between selling and applying would be to open a santander 123 account. I was also going to then put anything I can save over the £700 a month into this account as well.

Given the market at the moment this plan is currently on hold. I've therefore been looking at alternative options for where to put any extra savings (and have been leaning towards the Tesco 3% current account - once I have put down my deposit this would also leave me with a current account to use in order to take advantage of any £XX switching bonuses (which I haven't really been able to in the past)).

I have only just discovered that applying for credit cards and current accounts in the run up to applying for a mortgage can negatively impact your chances, and am really just looking for some advice on what's best to do. I'm limited to the £500 and £200 payments into my current savings accounts - my only other options at the moment are a 1.5% ISA or my current account (which is 5% interest but only up to 2.5k). Given I've opened/closed so much recently am I best just staying as I am and not worrying about maximising interest any further?

Not sure if it makes much difference but I will probably be applying for a mortgage towards the higher end of what I can get on my salary, but with a good sized deposit.

I am also getting a bit worried about (and this is probably where I need the most advice) about my credit limit across my 2 credit cards. I have around 10.5k but don't spend anywhere near this (as I clear my balance every month) and have read various things on how your used:available credit ratio can affect a mortgage application. So I'm wondered if I should try to decrease my limit across the two cards (I'm not really sure how possible/straightforward this is to do)?

Thanks in advance for any input anyone can give! :-)

Comments

  • amnblog
    amnblog Posts: 12,728 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Stop worrying - all of this is next to irrelevant.

    You are clearly careful and conservative - continue to pay everything in full and on time and you will be OK.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • I had wondered if I was worrying over nothing, but point 10 here is the kind of thing that's making me unsure...moneysavingexpert.com/loans/credit-rating-credit-score
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351K Banking & Borrowing
  • 253.1K Reduce Debt & Boost Income
  • 453.6K Spending & Discounts
  • 244K Work, Benefits & Business
  • 598.9K Mortgages, Homes & Bills
  • 176.9K Life & Family
  • 257.3K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.