Improving my mortgage affordability by combining debts into one loan

K_S

Jb1990bo said:

@K_S it would be what’s left on my loan, my partners car finance and a credit card that’s currently interest free that I had to put our new boiler on before Christmas. 

My partner also has a credit card and if we were just to pay them off say with the equity, that would give us enough affordability for the new house. 

@jb1990bo Thanks for the clarification. Very generally speaking, whether the same amont of debt is spread across four different kinds of credit or consolidated into one (say a credit card), by itself that doesn't make any difference to the lender.

The affordability may be impacted slightly by the actual outgoings for things like the loan, car finance, etc. while for credit cards lenders have a fixed % that they use as outgoing.

Just try out a couple of permutations and combinations on a lender affordability calculator to see what difference it makes using your current debt outgoing and if it where consolidated into one credit card.

https://online.accordmortgages.com/public/mortgages/quick_enquiry.do

Jb1990bo

@K_S I tried that affordability calculator and even with the potential measures we would take it wasn’t that great on the affordability front. I did then Google intermediatary affordability calculator and other lenders are willing to offer us what we need without us doing anything. I only tried NatWest and TSB intermidatary calcs but I will also try a few others to get more of a broad idea of it. Would you say that other lenders calculators are just as accurate as the one you posted?

Thanks for the advice your giving me I really appreciate it. 

K_S

Jb1990bo said:

@K_S I tried that affordability calculator and even with the potential measures we would take it wasn’t that great on the affordability front. I did then Google intermediatary affordability calculator and other lenders are willing to offer us what we need without us doing anything. I only tried NatWest and TSB intermidatary calcs but I will also try a few others to get more of a broad idea of it. Would you say that other lenders calculators are just as accurate as the one you posted?
Thanks for the advice your giving me I really appreciate it. 

@jb1990bo Lender calculators are only as good as the information you put in them and how they interpret that information as per their criteria. I don't remember off of the top of my head but does the TSB calculator specify what to put in under debt- current or at completion?

The reason I shared the Accord one as an example was because it clearly shows the difference between debt at point of application and debt at completion. Not all lenders see it that way, if that makes sense. Some will see it differently at different LTVs.

Sorry if I wasn't able to answer your question as clearly as you would like it, unfortunately there's no black and white answer I can give.

But as a rule of thumb, if you've got a huge difference in affordability showing across 2 mainstream lenders, you've likely keyed one of them incorrectly or without taking into account criteria.

Jb1990bo

K_S said:

Jb1990bo said:

@K_S I tried that affordability calculator and even with the potential measures we would take it wasn’t that great on the affordability front. I did then Google intermediatary affordability calculator and other lenders are willing to offer us what we need without us doing anything. I only tried NatWest and TSB intermidatary calcs but I will also try a few others to get more of a broad idea of it. Would you say that other lenders calculators are just as accurate as the one you posted?
Thanks for the advice your giving me I really appreciate it. 

@jb1990bo Lender calculators are only as good as the information you put in them and how they interpret that information as per their criteria. I don't remember off of the top of my head but does the TSB calculator specify what to put in under debt- current or at completion?

The reason I shared the Accord one as an example was because it clearly shows the difference between debt at point of application and debt at completion. Not all lenders see it that way, if that makes sense. Some will see it differently at different LTVs.

Sorry if I wasn't able to answer your question as clearly as you would like it, unfortunately there's no black and white answer I can give.

But as a rule of thumb, if you've got a huge difference in affordability showing across 2 mainstream lenders, you've likely keyed one of them incorrectly or without taking into account criteria.

@K_S TSB just says ‘ Please only include details of commitments that will not be repaid on completion of this mortgage. Where a balance is shared by both applicants only enter once.’ on the outgoings part of the calculator. Would that mean they accept debt to be paid off with equity? They didn’t ask for the totals of debt on the loan and car finance just the monthly payments so not sure if that’s what leading them to borrow more maybe?

K_S

@jb1990bo Apologies. Unfortunately, as a regulated mortgage broker I can't really get into any more specific detail as it's veering very close to advice. I'm sure someone else will be able to continue this conversation and give you the info you need. Good luck!

Jb1990bo

@K_S that’s no problem, fully understandable. Thanks anyway I’m sure it will get sorted one way or the other.