Will my mortgage application be rejected?

Caroline_83

Morning guys,

I’m hoping there’s a mortgage advisor lurking amongst you who can offer me some reassurance...

So, my partner and I are in the process of applying for a mortgage and I’ve just got my last 6 months bank statements together to give to our financial consultant.

My salary is just over £36k (my partner’s is just a little under that). My credit score has been nestled safely in “excellent” for the last couple of months and in “good” for a very long time prior to that.

However, I’ve always been a bit of a flippant spender and despite budgeting a damn site better in the last two months, the 4 other statements they’re asking for show that I’ve been in my overdraft. My overdraft is £1000.

Will this affect their decision despite the fact I’ve turned things around in the last 2 statements and that my credit score is excellent and also that jointly we earn more than enough to cover the mortgage repayments.

We’re looking to borrow £164k with a £20k deposit for a property selling at £184k.

ACG

Banks will generally only ask for the last 3 statements, some will not ask for any and if you apply to a bank in the same banking group they can see much further back.

Going into your overdraft varies from lender to lender, some will not care, others will have issues if you went into it not long after pay day.

Where is your deposit coming from? If you have £20k why were you overdrawn? I dont need an answer to that, it is just what an underwriter might be asking themselves. If your deposit is a gift, that is not going to look as good as if you have saved it yourself.

Your broker will sort it out for you im sure. It is not a deal breaker.

Carrot007

As long as you were not permenantly in the overdraft I doubt they would bat an eyelid.

ACG

Carrot007 wrote: »

As long as you were not permenantly in the overdraft I doubt they would bat an eyelid.

Some lenders would, especially if the deposit is a gift and the monthly mortgage payments are more than you are paying now.

Caroline_83

ACG wrote: »

Banks will generally only ask for the last 3 statements, some will not ask for any and if you apply to a bank in the same banking group they can see much further back.

Going into your overdraft varies from lender to lender, some will not care, others will have issues if you went into it not long after pay day.

Where is your deposit coming from? If you have £20k why were you overdrawn? I dont need an answer to that, it is just what an underwriter might be asking themselves. If your deposit is a gift, that is not going to look as good as if you have saved it yourself.

Your broker will sort it out for you im sure. It is not a deal breaker.

The deposit was partially gifted and part saved by my partner. I wasn’t permanently in my overdraft but tended to go into it from half way through the month. Unfortunately I’ve been a “Two weeks feast, two weeks famine” kind of person, however the last two months have seen big changes and I live to a budget per week now.

Mortgage repayments are equal to the rent we are currently paying (for the first 3 years at least).

Hopefully it shouldn’t be too much of an issue but only time will tell.

Thank you.

pink_pirlie

You earn significantly more than me and my partner (we are on 24k each) and we have been approved for the same mortgage amount you are looking at with no issues.
although no overdraft usage by either of us, but I do have a few thousand on a 0% credit card.

He has only been living in UK 18 months too with a resulting poor uk financial history.

We applied directly and didn't use a broker and all the bank cared about when we were applying were our financial commitments (I.e. Things we couldn't cut back on).
We spend loads of money currently eating out and enjoying life but we don't HAVE to spend that and if we didn't have the money we would cut back on that not the mortgage payments.