First Mortgage loans

WishIHadAName

Hi

Im looking at buying my first house with a 5% deposit. I know raising a 10% deposit is better but since renting Im just treading water trying to acheive this. My question is how much do loans affect a application? I currently have a loan with £2000 left to pay. I was looking at getting another loan to fund a car for a £1000 giving me a £3000 loan with payinf off the exisitinf one. This would add a year to paying the loan off but on a better rate. I i currently oay £96 a month and to take our a £3000 loan for three years would cost £72 a month. My question is, would it affect a mortgage application having slightly more debt or would paying less a month be better?

juniordoc

Depending on how much cash your 5% deposit turns out to be, the loan maybe more or less significant.
If it's 5% of a 300k house you're probably fine, if it's 5% of an 80k house then you really don't have much deposit once the loan is taken into account.

WishIHadAName

Well my partner will be supplying the deposit yet Im the bigger earner so will pay more mortgage. We have a £14000 deposit.

ACG

When it comes to loans, most lenders will work off the monthly repayment rather than the balance. So £72 is probably better than £96. However, that is not a hard and fast rule so it might be worth speaking to a broker if affordability is tight.