Credit cards: Do you intend to repay on completion?

borborygmous

Question on mortgage application, asking about a credit card account: "Do you intend to repay on completion?" (explanatory text: "Select yes if you intend to pay off the balance on this account on completion of this mortgage, otherwise select No. For childcare or second home please select No.")

Can somebody explain what this means? I repay my credit card in full every month. If I read it strictly, the answer is "No", but because I'm not sure I understand the intent of the question, either answer sounds potentially misleading.

Am I correct to assume "Yes" would mean I don't intend to pay any of the debt until then? Who does that??

Contemptuous

If you select yes, it's likely a special condition will be put into your mortgage offer that the balance has to have been cleared before completion. This question is more geared towards those who are doing debt consolidation or have an ongoing credit commitment, not someone who pays off a card in full each month.

amnblog

You are a yes on that question.

The intent is for the lender to understand if they are dealing with a borrower like you who uses a credit card for convenience and does not carry a monthly balance into the next month, and a borrower carrying credit card debt month to month.

Affordability calculations for each scenario needs to be adjusted.

maff39

Also on this note...

I received my mortgage offer last week which states I need to repay a credit card before completion. I pay the balance every month so this isn't an issue, however, my CC statement day is 3rd of the month but the payment is taken on the 28th, during which time I still use my card. So technically I pay the full balance on each month's statement but naturally I'm building up a new balance between statement and payment dates.

My completion date is going to be 24th of June so, when my statement comes out tomorrow and the balance is £200, this is what will come out on the 28th, but my completion date the balance may be £600, which will be cleared on the 28th July.

Will I need to show an absolute zero balance on the 24th June?