We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Changing Loan before Mortgage App
field1990
Posts: 19 Forumite
Hi All,
My partner and I are looking to buy a new build which will be ready end of the year (so mortgage application won’t be starting until around May/June time). We collectively earn £86k plus discretionary bonuses of £9,000 between us each year.
We are looking to buy for £620k and have £250k equity in our current place so need to borrow £370k.
Partner has no debt but I have £7k loan (104 pm for next 8 years) and credit card debt of £8k (this was £16k last year but have paid off over half on the last year). I want to consolidate my debt as realised loan rate is 11% and credit card is 29% and so in consolidating £10k of loan and some credit card debt I can get a better loan for £185 pm over 5 years and pay off the rest of my credit cards in the next few months before my application so will have no credit card debt.
If I choose to apply for a loan and repay the rest of the debts a few months before will this affect us getting a mortgage? I will then focus on saving as much as I can to then fully repay the loan in a year or two.
My partner and I are looking to buy a new build which will be ready end of the year (so mortgage application won’t be starting until around May/June time). We collectively earn £86k plus discretionary bonuses of £9,000 between us each year.
We are looking to buy for £620k and have £250k equity in our current place so need to borrow £370k.
Partner has no debt but I have £7k loan (104 pm for next 8 years) and credit card debt of £8k (this was £16k last year but have paid off over half on the last year). I want to consolidate my debt as realised loan rate is 11% and credit card is 29% and so in consolidating £10k of loan and some credit card debt I can get a better loan for £185 pm over 5 years and pay off the rest of my credit cards in the next few months before my application so will have no credit card debt.
If I choose to apply for a loan and repay the rest of the debts a few months before will this affect us getting a mortgage? I will then focus on saving as much as I can to then fully repay the loan in a year or two.
Many thanks!
0
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 351.7K Banking & Borrowing
- 253.4K Reduce Debt & Boost Income
- 454K Spending & Discounts
- 244.7K Work, Benefits & Business
- 600.2K Mortgages, Homes & Bills
- 177.3K Life & Family
- 258.4K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.2K Discuss & Feedback
- 37.6K Read-Only Boards