Currently applying for mortgage - can I increase credit card limit?

elouber

Hi,

Looking for some advice. 

Just had a offer on a property accepted so just starting the process of getting a mortgage approved.

Luckily have always been good with my money and not found myself in a situation where I’ve got into debt or owed anything. Have only ever had one credit card for the past 8-9 years and use it mainly for online shopping, paid in full every month.

However, thinking ahead, the nearer I get to exchange and completion Id like to start ordering some furniture etc and use my credit card to pay for items for the extra protection using it can bring. Not planning on spending outside of budget so can pay for items in full once received.

But my credit limit on my credit card is £2,200 - bit low for getting the bits I’d like to get - so question is, am I in a position to up my credit limit on the card, and if so when would be the best time to do it? Im assuming doing just before getting mortgage hopefully approved not ideal, but what if I get mortgage approved and then have that wait between approval and completion? Would increasing the limit affect my approval if already received?

Any advice would be great - like I say, it’s not to take out any debt, just a way to order furniture with some security?

many thanks!

[Deleted User]

Don't make any credit changes once you have a mortgage offer and definitely not after exchange.

eskbanker

elouber said:

Id like to start ordering some furniture etc and use my credit card to pay for items for the extra protection using it can bring. Not planning on spending outside of budget so can pay for items in full once received.

If it's section 75 protection you're after, you can benefit from this for the whole value of your purchases even if you only put a penny on your credit card, so if you have the opportunity to make partial payments by credit card when buying your furniture then that may resolve your insufficient credit limit issue....

Brie

The extra credit available would likely reduce the amount of the mortgage you can get so I wouldn't risk it. Also I wouldn't recommend buying anything for the new place until it is actually yours. Just in case...

Sandtree

elouber said:

Hi,

Looking for some advice. 

Just had a offer on a property accepted so just starting the process of getting a mortgage approved.

Luckily have always been good with my money and not found myself in a situation where I’ve got into debt or owed anything. Have only ever had one credit card for the past 8-9 years and use it mainly for online shopping, paid in full every month.

However, thinking ahead, the nearer I get to exchange and completion Id like to start ordering some furniture etc and use my credit card to pay for items for the extra protection using it can bring. Not planning on spending outside of budget so can pay for items in full once received.

But my credit limit on my credit card is £2,200 - bit low for getting the bits I’d like to get - so question is, am I in a position to up my credit limit on the card, and if so when would be the best time to do it? Im assuming doing just before getting mortgage hopefully approved not ideal, but what if I get mortgage approved and then have that wait between approval and completion? Would increasing the limit affect my approval if already received?

Any advice would be great - like I say, it’s not to take out any debt, just a way to order furniture with some security?

many thanks!

Until the mortgage money is in your account any changes you make create a risk that the offer is withdrawn... its up to you to judge if its worth potentially having the sale fall through.

To get S75 protection the item must be valued between £100 and £30,000 however you only have to pay something towards it on credit for the protection to apply, doesn't have to be the full balance. It makes life difficult if wanting to buy online but outside of that you just pay a token amount via your low limit CC and pay the rest by debit card or such and thus avoid the card's limit being an issue.

MalMonroe

Brie said:

The extra credit available would likely reduce the amount of the mortgage you can get so I wouldn't risk it. Also I wouldn't recommend buying anything for the new place until it is actually yours. Just in case...

I echo what Brie says, particularly about not buying anything for the new place just yet. Because when I was married (many moons ago), as soon as we'd exchanged contracts to buy a property, I went out and bought some lovely towels to go in the lovely bathroom and light shades and some beautiful curtains and . . . I won't go on but it all fell through and we were heartbroken. We loved the house and then had to start all over again.

Maybe that all happened so I could learn a lesson and then later, warn others. Don't make any sudden moves or take on any extra expenditure until you are in and settled - then you can go shopping for lovely towels and curtains, etc. 

phillw

Sandtree said:
Until the mortgage money is in your account

Mortgage money has never gone into my account.

I assume you mean "until the funds are released".

I'd personally wait until completion, keys have been exchanged, etc etc.

elouber

Hi everyone,

Thanks for all the advice - seems I was thinking along the right lines but just leaving everything as is!

And don’t worry, won’t be making an large purchases anytime soon, just trying to be a bit forward thinking - this housing market is far too volatile to be assuming a property is
mine until those keys are in my hands!

Can I ask, as a follow up question, can I continue to use my existing credit card as I normally do, small purchases here and there when needed, always paid off in full every month, during this whole mortgage process? Or am I really just best off locking it away for the time being!

Thanks again for all the help and advice!

cymruchris

elouber said:

Hi everyone,

Thanks for all the advice - seems I was thinking along the right lines but just leaving everything as is!

And don’t worry, won’t be making an large purchases anytime soon, just trying to be a bit forward thinking - this housing market is far too volatile to be assuming a property is
mine until those keys are in my hands!

Can I ask, as a follow up question, can I continue to use my existing credit card as I normally do, small purchases here and there when needed, always paid off in full every month, during this whole mortgage process? Or am I really just best off locking it away for the time being!

Thanks again for all the help and advice!

Continue to follow your normal behaviour. Don't lock it up.