Overdraft Effect on Mortgage Application

TJParsons

Hello all,

We shall be submitting a mortgage application fairly soon through HTB, with no outstanding CC debt, but potentially with £1k of overdraft (dependant on its effect). I've seen that 5% of the OD balance can be used as part of an application's monthly outgoings, but just wanted to confirm that fact before submitting an application and it being a deal breaker.

Many thanks for your help.

TJ.

rtho782

We've just gotten a mortgage of £218,500, my fiancee has a £1500 0% O/D with Halifax (from when she was a student, she graduated in 2015) that we have yet to get around to paying off.

Nationwide did not ask about overdrafts so we did not tell them. They asked about credit cards and loans.

I assume they saw it on her credit report, but it was never mentioned to us.

dgtazzman

A 0% APR overdraft would mean no monthly cost involved with it, so no effect on affordability calculations. Maybe that is why it wasn't queried in your case. Most overdrafts aren't 0% APR, however, so would have a different effect.