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Changing Loan before Mortgage App
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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!
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