Car Loan and Mortgage Application

bigtoasty

Hi all, looking for some information and experience on how loans affect a mortgage application.

Bit of background - I've never owned a nice car, been looking recently and found the one i'd really like. I have around £15k in savings and was planning to use approximately £6k of my own money as well as £14k through a bank loan. The loan eligability reckons i've got a 90% chance of acceptance through Natwest (my current bank) at 3.4&APR. I can afford the £250 monthly loan repayments with plenty of wiggle room.

The remaining £9k stays in the bank and gets bumped up through monthly savings of £1k (I've been led to believe this is around the mark of monthly house running costs, mortgage, water, electric etc).

I'm hoping to purchase my first house this year, with a 10% deposit (expected to be around £15k) the money i've then been saving each month will be used to pay the mortgage and run the house etc.

I do have a credit card (through tesco) i usually use it for large purchases and pay it back straight away, i have a credit score of 970ish last time i checked.

After all that information, will my loan affect my chances of getting a mortgage okay?

Thanks in advance!

bazzyb

Too many variables to say whether it will affect you or not - but it would more than likely have an impact.

From the bank's perspective, you will have recently taken out a £14k personal loan, and you have a £15k deposit - so in that respect it would appear that you have a £1k deposit from your own funds and have borrowed the other £14k.

The most sensible thing to do would be to either stick with your current car, or if you urgently need one use some of the £6k to get one and buy the nice car at a later date once your house purchase is sorted.

Herzlos

Get the mortgage and then the car

bigtoasty

Thanks for your replies guys, appreciate it