Debt repayments not shown on Mortgage Offer

jdc23

We are FTBs using the Equity Loan Scheme to purchase a new build property. People on this forum have been very helpful in guiding us through this process. I just have one simple question remaining.

We have approx. £5k on credit cards between us and intend to pay this off before we complete on the property in August/September. We put it forward to our broker to include this detail in the mortgage application to help our affordability. We received our full written mortgage offer last week and having checked it all through there is no mention of repayment of anything. I would have thought that these details would need to be included in the written offer. Does this mean the lender is no longer expecting us to repay these debts?

I have read that solicitors usually get involved with checking the required repayment of debts prior to completion, but also our solicitor has mentioned nothing about this and there is also nothing in their paperwork.

I have requested further details from our broker and a copy of the full application form if possible, hopefully I will receive this soon, just interested in other people's experiences with this.

amnblog

Sometimes the Lender includes a requirement to clear the credit card in their conditions on your mortgage offer.

In this case they haven't, which leaves you with one less thing to worry about.

jdc23

That's good to know, just wasn't sure. Thank you very much.

jdc23

An update to this thread... I thought it best to check this with my mortgage broker to be certain. I have had an email in reply that states that although the mortgage offer we have received does not state repayment of any individual credit commitments, they believe that it would be covered under the following statement on the offer:

….there has been no material change in your circumstances since the date of this Offer, which we were not aware of,
which could affect your ability to afford the loan. By this, we mean a change to your circumstances which, had we
known about it at the time of making this Offer, might have resulted in us being unable to provide the Offer to you or
only being able to provide the Offer to you for a lower amount.

They have said that it will be the Solicitor's responsibility to check all is paid off. I am still a bit confused as I have nothing anywhere in writing of what is expected to be paid. I will check with the solicitor and see if they have received more information on this.

kingstreet

The broker should know what THEY entered on the mortgage application and if THEY indicated it was to be repaid or not.

We automatically supply a copy of the mortgage application to our clients when it has been submitted. It may be a good idea to ask for a copy of yours!

phillw

jdc23 wrote: »

I am still a bit confused as I have nothing anywhere in writing of what is expected to be paid.

On the face of it, then I would think they assume you will do what you told your broker you were going to do.

"We have approx. £5k on credit cards between us and intend to pay this off before we complete on the property in August/September. We put it forward to our broker to include this detail in the mortgage application to help our affordability."

Do you not intend to pay it off?

marliepanda

phillw wrote: »

On the face of it, then I would think they assume you will do what you told your broker you were going to do.

"We have approx. £5k on credit cards between us and intend to pay this off before we complete on the property in August/September. We put it forward to our broker to include this detail in the mortgage application to help our affordability."

Do you not intend to pay it off?

Seconded.

Maybe the broker put 0 for cc debt as you told him there would be none...?

kingstreet

marliepanda wrote: »

Maybe the broker put 0 for cc debt as you told him there would be none...?

If the broker did that and the credit search picked up the balance, affordability would be affected, possibly resulting in a decline.

You enter all credit and where appropriate note it will be cleared on or before completion.

That's why sight of the application here is the key.

If the case affordability is strong enough to withstand the credit continuing, there would be no reason to mark it to be repaid and the OP's thread would be redundant.

toc25

Hi just wondered if there was any update on this?

The same thing has happened to us, we said we would clear a loan and credit card on completion with equity from our house sale. The mortgage offer came through with no mention of it at all.

I was assuming the solictor would be sorting it out but I'm now guessing that it's something I will have to do with money left over after completion.