Mortgage applocation

SCE3116

My husband and I are first time buyers and have just sale agreed on a property. However We do not have a mortgage agreed in principle, we are using an independent mortgage advisor who advised that she did not like to apply for mortgage in principle as it leaves a mark on credit score, and we hadn't secured sale agreed/found right house at time of inquiring about a mortgage in principle. Our Mortgage advisor has said that we have good affordability and agreed to vouch for same with any agent. Now we are in position of actually applying for mortgage both my husband and I are anxious about our use of agreed overdraft facility on our current accounts, we both use overdraft every month though never go over agreed limit, we both have good credit rating of 900+. I suppose we are anxious because the advisor have never really seemed to look at any of the documents we have supplied her (bank statements), and though we mentioned our use of overdraft she never really acknowledged same. If we knew from outset that this would mean our application would be declined we could withdraw offer and she paying her fee and bank fees if it is silly to apply given or use of overdraft- anyone got any advice? Experience of this?

Thrugelmir

SCE3116 wrote: »

Now we are in position of actually applying for mortgage both my husband and I are anxious about our use of agreed overdraft facility on our current accounts, we both use overdraft every month though never go over agreed limit,

Why not clear the overdrafts from savings? Rather than allow your credit reports to be sullied. Lenders work on the facts that they see.

banks4u

Some DIP from lenders don't have a hard footprint like Halifax. What is your income and how much are you looking to borrow? Also what is your deposit?

SCE3116

Hi, we have offered £142,500 on a house that was for sale for £150,000, and offer has been accepted. Both our overdrafts are cleared every month, but subsequently used again, we have given up our rental property just this month, and would be in position to clear and stay out of over draft going forward, however at the minute we wanted to apply for mortgage asap as we have found the house, & sale has been agreed, we don't want to use savings to touch overdraft as they are just now making our 10% deposit this month, though again as of next month we will have £1000 more, we earn a combined salary of £55000 per year

AnotherJoe

SCE3116 wrote: »

we don't want to use savings to touch overdraft as they are just now making our 10% deposit this month

In essence you have funded part of your deposit from your overdraft. Many lenders won't like this because really it means you haven't saved all that deposit, you've borrowed it. Take an extreme case as an example, you might say you have a £10k savings for a deposit but if you also have a £10k overdraft, in reality you haven't saved anything.

The other issue you may have is, when looking at bank statements, each month you go into overdraft. Nota good sign. Are you sure you can afford this mortgage ?

Perhaps your particular lender will be ok with this.

SCE3116

Thanks I see what you mean, I suppose we will just have to wait & see what lenders decide once application is made.