Will a balance transfer CC ruin my mortgage chances?

7sefton

Hi everyone

I’m looking to move house in the next 3-6 months and will need a new mortgage. 

However I have £10K of credit card debt that I usually recycle through 0% balance transfers. I have more than enough cash in savings to clear it but I prefer to earn a bit of interest on the cash and let inflation eat into the debt.

I am really tempted to do another 0% balance transfer now, as my existing promo deal comes to an end in May. I could get 3 years at 0% easily. But will it ruin my chances of getting a mortgage? 

(I’m just trying to figure out if banks view balance transfers in a more favourable light than 0% spending, for example) 

kingstreet

Lenders don't see the whole picture. They see only a hard credit search.

No-one can say what impact this will have as no-one knows the state of your credit history. Whatever impact it may have; it certainly won't be helpful.

K_S

@7sefton With regard to credit card debt, what matters to the lender is the total debt, doesn't matter if it's at 0% or the full whack.

With regard to applying for a new credit-card, that would incur a hard-footprint credit check on your credit report. The impact that may have on the lender 'credit-scoring' (nothing to do with the Experian/Clearsscore/Credit karma score) will lessen over time. I can't speak for your specific case (as that depends on your personal circumstances, what your file looks like, your borrowing requirements, etc.), but I wouldn't expect a 6-month old cc credit footprint to make a material difference.

What you definitely don't want to do is apply for a BT card a short while before a mortgage application as it's quite possible that your credit report will show two balances (the card being transferred from and the card being transferred to) at the same time for a few weeks as the report is updated.