Mortgage application and existing Debt

skane88

Hi All,


We are looking to move house, currently in a house worth roughly £100K with a mortgage of 28K. I have credit card debts and car finance outstanding to an amount of £20K. As it stands affordability isn't good, the banks online mortgage calculators wont offer us anything. If I was to pay my debts off affordability is brilliant and it looks like the banks will lend significantly more than we require to move house!


My question is, will the bank offer a mortgage on the basis that when sale of this property goes through, £20k is held back to pay off the existing debts?

Theguywhovapes

Certainly possible as long as you intend to follow through on what you declare

skane88

Certainly would be but the worry is that the bank would have to trust me to do it. If it's written into the mortgage offer then hopefully they would go for it.

Theguywhovapes

Some lenders would write it in I imagine. If you’re assessed on the basis that you will pay the debts, shouldn’t have a problem.

Silverum

Absolutely possible. We did this previously - it wasn't written into the mortgage offer and they didn't want evidence of zero balance on our credit card, which does seem a leap of faith on their behalf, but then I suppose it would have been more fool us if we'd not paid them and then been in a mess affordability wise.

skane88

That’s what I’m thinking to be honest. If I don’t pay the debts off then I won’t be able to afford the new mortgage and the house will be repossessed so it really wouldn’t be worth me not paying them off! Thanks!