Oustanding Credit and Mortgage Offer

MatchaMan

Hi
My wife and I received our mortgage offer a while ago. We should be moving to our new property at the end of August or early September. There is a condition of mortgage offer that states:


"You have declared an intention to repay some or all of your outstanding credit commitments. The mortgage advance has been assessed on this basis and it is your responsibility to ensure that these commitments are repaid. Completion takes place on the condition that such repayment takes place".


At the time of offer we had outstanding credit of:


£6250


We now only have an outstanding credit of:


£500


As the condition of offer states all or some of our financial commitments. Would this constitute that? If our credit commitments increased should this be a problem?


Thanks for your help in advance.

cahillg81

No - it's up to the sols to check and sometimes they don't even bother. But as long as you can show a bank statement with the required funds to repay it should be fine. If you can afford to its best to repay.

David_White

MatchaMan wrote: »

it is your responsibility to ensure that these commitments are repaid.

I would say this line gives an idea of this particular lenders attitude towards the debts.

MatchaMan

David_White wrote: »

I would say this line gives an idea of this particular lenders attitude towards the debts.

Thank you for your reply. How about the statement


"You have declared an intention to repay some or all of your outstanding credit commitments."


Does that imply that I do not have to pay all of my credit commitments and that if I show a willingness to pay at least the majority of them that should suffice?

David_White

As cahillg81 said it'll largely come down to your Solicitor and how thorough they want to be.

The lender has chosen to make the statement vague though compared to some lenders that will itemise every debt that needs to be repaid so I'd would assume there's a bit of flexibility.

MatchaMan

Thanks for the replies. I will check with my solicitors.

richbek

We've just taken out a mortgage and one of the conditions was that my husband's credit card was paid off - the terms specifically name the credit card and at the time balance, so the solicitors insisted on seeing proof that this had been done before we could exchange.


Your wording is much more vague than that so I would think that by reducing your outstanding debt by a significant amount you have fulfilled that condition.


I'm by no means an expert though so it's definitely safer to speak with your solicitor.

baxdad1

Is your mortgage offer from TSB by any chance?? I have exactly the same wording on my mortgage offer. I'm going to clear it asap just to be on the safe side. But like you say, it seems a bit vague considering it doesn't say what the current balance is!

MatchaMan

Sorry to resurrect this post, but I checked with my solicitors and they suggested that the outstanding amounts need to be paid on repayment of the full mortgage amount - 25 years. I also called the lender and they said they don't check if financial commitments have been paid at the time they release funds. They said the onus is on my solicitors to check this. Interesting.