credit card v's loan debt?

wen-tom

looking to move house, we have credit cards & a loan.
We're trying to decide whether to get a slightly bigger loan to pay of the current loan and the credit cards so that we don't have any outstanding credit card balances.
does anyone know if mortgage companies/banks look more or less favourably on you for doing this?
It would obviously be a bigger loan, we would probably slightly reduce monthly outgoings but if we close the credit cards we would then have less available credit..
We were hoping to be able to pay a chunk off credit cards but a bonus we were expecting is now not going to happen!
Thanks in advance..

csgohan4

they will look at your total debt as I understand, loan or credit card otherwise. They look at your credit file history. Having a large debt will reduce what you can borrow.

poppy1010

I know the answer to this! as this was something we looked into.

With a credit card, lenders will take a % of your total balance and deduct that off of affordability per month. With a loan, they deduct what amount you pay per month. We were told by numerous people, that a loan was better than credit cards as the amount per month is usually less that what % they would deduct for credit cards.