Mortgage application - Advice Required

gbeanf

Hi all.

We are looking for some expert advice with regards to the likelihood of finding a lender who would accept us for a mortgage.

We are well paid, with a take home income of around (£125,000) - or around £6500 a month jointly.
Despite this, we have around £19700 of credit card debt, using > 90% of our available credit.
In addition, between us both we have 4 personal loans.
We make payments on all of our debt every month, but typically only the minimum payment.
We also both live in our overdrafts - a total of 4500 arranged.

We have reserved a new build property for £399995 and have agreed a part exchange of our property for 240,000 (this is 20k more than we bought it for 5 years ago). There is 180,000 remaining on that mortagage.

We want to obtain a 90% LTV loan and use the 20k in equity to pay off our expensive credit card debt.

We have an AIP for nationwide and Santander, and have been quoted an 1.8% deal with Barclays, which actually means our mortgage payments will be cheaper than currently.

Will we get a mortgage? I'm worried we look attractive due to our incomes but may fail a full application.

ACG

Santander are a lender who you will probably find double counts the debt (or it is being cleared but they assume you will just run it all back up again).

I think there will be lenders for you. I think you need to be looking at the lenders most likely to accept you rather than 0.1% here or there. That's not to say you won't get a mortgage with the lenders you have found btw, but concentrate on likely acceptance rather than a few quid here or there.

There is also another question that you guys need to look at which is why on such a high income you have so much debt. I am not looking for you to answer that on here, but is there a real reason behind it? If not and it was just spent on "stuff" is it something you have learnt from and is it likely to happen again? Sorry for the condescending part of the post but sometimes it just needs pointing out, although you do seem aware you have a lot of debt so hopefully not offended by me mentioning it.

gbeanf

Out of interest, who are the lenders that are more likely to accept us? We don't want to be declined, although we accept with our situation this may be an issue.

We are doctors working in the NHS - our salary has increased quickly over the last several and have taken on a lot of debt to allow us to progress within our careers (for example, we've both spent 20,000 on pursuing masters degrees and our postgraduate exams have added up to several thousand pounds each). Grim, but not disssimilar to many other public service employees.

Are there lenders who don't ask for bank statements - i'm worried they will see us close to our overdraft limits and decline us. We really want to use the 20k in equity we've accrued to clear our expensive debt.

gbeanf

I should add that we've spoken to two separate mortgage advisors who have quickly assured us that this "wont be a problem" but I find that advice to be a bit troubling and have wondered if they are just after our custom.

[Deleted User]

gbeanf wrote: »

Are there lenders who don't ask for bank statements - i'm worried they will see us close to our overdraft limits and decline us.

They don't need bank statements. They'll pick up the overdraft usage from your credit files.

You would also need to declare the debt in any case.

gbeanf

Hi, thanks for your reply. I should point out we aren't trying to hide this and have declared all our outgoings and debt in full from the outset.

Keen to hear other constructive advice from those that may be able to offer it.

[Deleted User]

As long as the debt payments are up to date and you haven't gone over overdrafts or missed payments then it will be fine.

Not all debt is bad debt (an example here as you took on debt to boost your career). As long as its serviced and up to date you wouldnt be declined on that (as long as it passes affordability calculators of course)

I work in a university town and near one of the biggest hospitals in the country as well as oodles of IT and games companies. Salaries like his aren't uncommon for my clients and sometimes their monthly debts are much higher than 99% of people would be comfortable with. Like I said as long as a history of being in control is evidenced then lenders very rarely question it

ACG

We can't name lenders on a forum as we don't know enough about you.

I don't think you will have a problem getting a mortgage, I agree with the other brokers on that front. I just think you need to concentrate on the right lenders rather than the rate. Stick with one of the brokers, make sure they only get paid on offer and providing they come back with normal rates you should be fine.

gbeanf

Thanks for your advice - it's appreciated.

Can I ask - do you think it is worth me trying to engage with a broker who specialises in adverse credit mortgages or will I be ok with the brokers we've already spoken to?

Trying to maximise our chances right from the start of the application.

ACG

Do you have bad credit? You have only said you have a lot of debt. Assuming the debt is being paid on time each month then you do not have bad credit so do not need a bad credit broker.