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FTB advice on debt

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Dear All,

Iam planning for a new mortgage, have not found a property, but looking to buy somewhere in W. Midlands.
My situation:
Salary :34k
Cc1: 3200/4000
Cc2: 1800/3000
Cc3: 500/3500
All the above credit cards are balance transfer cards
Loan of 2500: 88pm until Nov 19
Partner: looking after 2 kids 5 and 2.
No child care costs.

I have cash of about 8k in my account and about 7k from my brother whom i lent the same when he was getting a mortgage. He does not have the money currently, but will be borrowing from friends.

My question:
Can i show the funds as gift from him, even though he is borrowing from his friends/colleagues?
Is it worthwhile closing loans/credit cards before applying for mortgage?

BW
Amit

Comments

  • csgohan4
    csgohan4 Posts: 10,600 Forumite
    Ninth Anniversary 10,000 Posts Name Dropper Photogenic
    all your loans and credit balance will impact on your affordability severely. It shows in this case you have a borrowed deposit as all of it comes to make about your deposit by yourself 8k.


    Plug some numbers into the affordability calculators at some of the lenders websites such as nationwide, Halifax e.t.c.


    In regards to gifted deposit, they will be asked to sign a gift declaration and maybe asked to show the account the deposit was in


    In terms of closing the loans, see how much you can borrow first and play around with and without the loans
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"

    G_M/ Bowlhead99 RIP
  • ACG
    ACG Posts: 24,555 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    The debt might not be an issue depending on how much you are looking to lend. If you want a Mortgage for £150k then it is going to be a bigger issue than if you want £100k.

    The bigger issue will be the deposit. If you plan on applying directly, I would discuss this upfront before doing any credit checks. If you plan on going through a broker, explain it to them and let them worry about it.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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