First time buyers - credit card advice...

nikh667

Hi all

Myself and my wife are nearly at the point we have enough of a deposit (including government contribution with help to buy ISA) to purchase our first house.

I have a credit card with a balance of just under 3k on it - £1900 of which I can look to paying off with a lump sum I'm due to receive in the next few days.

Our wages give a rough lending of around £215k, and we're looking to buy a place around £185-190k.

So my question is, do I do the sensible thing and pay off as much on the card as possible (there will be a balance left afterwards), or use the lump sum to add to our deposit so we can look to move sooner in the year.? Will doing this affect us to the point of not being able to achieve the 185ish we'd be borrowing.

I know there are a lot of other factors, just general advice as to the best thing to do.

foxy-stoat

Will the £1900 extra for the deposit put you into a lower LTV band?

nikh667

No unforntuately. We're just about scraping together for a 5% deposit. It will just mean time wise that we can look to buy earlier in the year.

nicholbb

For me when I looked into it, it was my wages x 4.5 less credit card debt x 5.

E.g.
Pay 10,000 (45,000)
Credit card 1,000 (-5,000)

Mortgage offer would be 40,000.

Bertrum

Paying off the Credit Card may be a condition of the mortgage offer anyway, if you are tight on LTV then you will have to do this.

Rob