Moving home - worried about failing new application

septemberbaby

Hi all

I am an existing Virgin customer with my husband on our family home.

We want to move asap to a bigger home. I am so scared of applying as i stupidly took out a number of loans over the last two years that mean i pay out a large sum every month.

I am looking to double up on some repayments to speed things up and maybe look at applying early next summer. My biggest thing/fear is i am always in my overdraft fully for like 28 days of the month. I also have a credit card that i pay minimum back to thats £1000. The loans i wont get in to but im clearing one in full that is a silly interest rate after xmas and then im doubling up on payments for the others. Im ust wondering when ill get chance to pay off my overdraft really as with doubling up on repayments etc.

Anyways my husband is debt free and has equity in other homes etc and is squeaky clean. I just dont want to be the one that makes it fail. I know ive made the stupid mistakes with loans and my lord i wont be ever making them again ever. Anyone got any advice, or been in a similar situation themselves at all

ACG

Get out of the overdraft.

If you want a bigger mortgage and your hammering the overdraft an underwriter is going to see that as bigger mortgage = going over the overdraft.

So long as it fits affordability, there is no reason why it shoudl be declined, having debt in itself is not a bad thing.

Thrugelmir

Get yourself over to the Debt Free Wannabe forum. Plenty of support and advice over there. Only you can resolve the underlying issues.

fewcloudy

septemberbaby wrote: »

Hi all

I am an existing Virgin customer with my husband on our family home.

We want to move asap to a bigger home. I am so scared of applying as i stupidly took out a number of loans over the last two years that mean i pay out a large sum every month.

I am looking to double up on some repayments to speed things up and maybe look at applying early next summer. My biggest thing/fear is i am always in my £2000 overdraft fully for like 28 days of the month. I also have a credit card that i pay minimum back to thats £1000. The loans i wont get in to but im clearing one in full that is a silly interest rate after xmas and then im doubling up on payments for the others. Im ust wondering when ill get chance to pay off my overdraft really as with doubling up on repayments etc.

Anyways my husband is debt free and has equity in other homes etc and is squeaky clean. I just dont want to be the one that makes it fail. I know ive made the stupid mistakes with loans and my lord i wont be ever making them again ever. Anyone got any advice, or been in a similar situation themselves at all

Can you (maybe you've tried) apply for a 0% Balance Transfer credit card? If you were successful you would transfer the balance of any existing cc's onto your new one, and pay 0% interest. That way you would either be able to pay the balance off quicker (because more money is now paying off the capital), or you could use the money that you no longer have to pay each month to start to pay off the loan that is a 'silly rate'. Or start to reduce your overdraft.
All the info you need is under Cards and Loans on the main site.

Candyapple

Does your husband know about the loans/debts? If not and he is debt free, it might be an idea to have a sit down with him and perhaps you two as a couple can figure out a way to pay off the debts sooner rather than later.

Also, what were the loans for? If they were for household expenditure then your husband definitely should know that your budget isn't sufficient if you had to take out loans to pay for things.

What happens if you found your dream home next month and your husband wanted to proceed?

TheFinanceGuru

First thing I always discuss with clients why do you want to move? Is now the right time to consider moving due to the debts you have?

It might be worth considering holding on for a further 12 months and spend 12 moths reducing your loans and overdrafts significantly. It might also allow you longer to save up for a bigger deposit and getting a bigger home. A lot of people move for the sake of moving when if they waited 12-24 months they could get a bigger home, and end up not needing to move for a further 12-24 months.

If you are set on moving I would work on reducing the overdraft first, mainly as this is the easiest to reduce and is often a far higher interest rate than any loans.

The best thing you can do is talk to a broker, or look at the criteria of banks yourself online. Rather than waiting until you need to apply for a mortgage find out now whether you can get one. If you can get one brilliant, if not at least you know you can't and you can work towards getting your finances in a much better position.

If you need anything else don't be afraid to ask.

ShivasPlace

When we started looking into moving home and getting a new mortgage, we had a few credit cards between us and an overdraft that was used every month. The bank we visited suggested paying off the credit cards first, starting with the smallest monthly payment one, and leave the overdraft until last.

By this attitude, I assumed that having an overdraft is 'safer' than a credit card. Is that actually not the case - or is it something that varies between lender?

AnotherJoe

Seems to me, part of the problem is you say you'll pay off the cc with the stupidly high interest rate after Christmas. That and the fact you can't get out of your overdraft. .

So you are still in a mode of spending.

Fix these two first.