Mortgages and overdraft usage

Jon_B_2

I'd imagine it would affect affordability as it will be treated as a debt in the same way a loan or credit card would be.

More importantly you need to realise why you are still utilising an overdraft. It's not free money, could get called in at anytime and/or have interest applied. I personally believe it is good practice to make sure you start living in the black with regards to current accounts.

row-cm

Hi all! I have just signed up to ask for a bit of advice on my situation, which is exactly the same as ftba.d's. I'm also having a bit of a panic over overdraft use. I have generally been clear of my overdraft for about 6 months (again, a uni hangover) but in July I went over by £95.00. I reduced my overdraft allowance to £100 a few months back. I generally do not go into it however. We will potentially be applying for a first time mortgage next week (possible by Nationwide) and I'm very worried that they are going to look on this as living outside my means.

Also, does anyone know how scrupulously they go through payments on the statement? I have a couple of birthdays prior to going overdrawn and am very concerned that there are a few statements that are clearly pubs!

Any advice would be greatly appreciated!

(I have checked my credit score online and it is excellent, but that isn't giving me much peace of mind at the moment!)

Killykev

For what it's worth my broker told me mine would be fine as long as it wasn't for gambling or other luxuries that I could do without. General living should be no issue.

amnblog

There is a lot of fidgeting about Overdrafts on the Forum.

An Overdraft is just another item of lending or potential lending. Used within it's rules it is not a problem.

swishy87

We often went into our £200 overdraft, and sometimes even unarranged without realising. I read too much on here and got myself in a right old tiz! But it was absolutely fine in the end. (Well, we're still between exchange and completion so I don't really want to tempt fate!)

AnotherJoe

Jamie_Cortez wrote: »

We go into our overdraft every month, but our pay clears it and then some each month.
We had no issues getting a mortgage with Natwest.

So you essentially have zero savings?

swishy87

Honestly, try not to worry. Our offer is with Nationwide and I was panicking after everything I had read on here. I don't know what they looked at tbh, but we provided our broker with 3 months bank statements. On those we went into overdraft sometimes and had LOTS of spending at pubs (go out every Friday night). We applied and within a week had an offer. Obviously there's lots of other things that will affect it and everyone's circumstances are different, but try not to let that bit worry you unnecessarily.

yessuz

AnotherJoe wrote: »

So you essentially have zero savings?

well, in my case, I had for example, 12K, sitting in ISA as savings while being, for example 100£, in planned overdraft 1 day before my salary. The next day, salary is being paid and obviousy everything is cleared and paid off.