Mortgage and credit cards

Lucielou1

Hi I ve just been declined 2 AIP though a broker because of a higher number of credit cards. I told the broker about them but he still insisted on applying. Anyway I have £30000 which I can use to pay of all my credit cards and close the accounts ( I know way to much credit card debt!!)
Does anyone know how much time I need to wait before applying again. Will I need to wait 6 months / year to show I remaining out of credit debt or can I apply sooner.

foxy-stoat

You don't need to clear them before you apply - you can apply stating what the balances will be and the lender will based their decision on that. As long as you do clear them before you complete then you should be fine.

Surprised your broker hasnt told you this already.

Lucielou1

He just said that Halifax and nationwide declined. The nationwide went to underwriter who said we basically have to much debt. But the plan was always to pay off as much of the debt. The broker said we ll need to wait 6 months from paying off to applying again

[Deleted User]

A lender accepting that you will clear them prior to completion is usually to achieve a better affordability

What you are getting tripped up by here (I think) is Debt to Income ratio.

There are some lenders that publish their limits, there are others that claim they don't have any limits, and then there is everyone in the middle who has a limit but it probably changes depending on overall case.

Ultimately you can either go to a lender who doesn't look at these limits. Or clear them and try again.

If you have been credit scored by a lender they are usually locked in for 3 months so will need to wait 3 months before reapplying, if you go to a new lender than you can do so as soon as the credit report is updated

Lucielou1

Thank you that’s really useful

foxy-stoat

I recently got my mortgage with Halifax agreed, had £25,000 of credit card debt that I said I would clear on the day of completion - they were fine with it and it was all cleared with no issues.

Something else must be causing you an issue for the broker to do 2 AIP and both of them came back as decline.