Mortgage offer and need loan

MrFrugalFever

In my experience (with large car loans) a final credit check is made upon final payout to ensure that the borrower hasn’t saddled themselves with unaffordable debt between the point of application and driving away. This is part of the ‘responsible lending code’ and one which I actually fully agree with.

Due to the nature of your purchase I am almost certain this will be the case. Whilst it may only be a ‘soft search’, it could be enough to alter the whole terms and conditions thus leaving you extremely out of pocket.

A friend of mine moved in to a new build property just before the start of COVID and had saved up just enough for a deposit using a government help to buy scheme. She had some white goods as part of the purchase along with carpets I believe but nothing else (curtains/furniture etc). Once the completion had taken place, she had left it a good few days just to be 100% certain and then applied for a 0% credit card. She used eligibility checker first. She then used that to get a few things to get started.

She had enough disposable income to buy essentials such as food and toiletries and I think she rallied around for some bits but essentially slept on the floor and had 2 camp chairs in the lounge. It was all very basic but necessary. 

It was only a matter of a couple of weeks before she was up and running.

Good luck with the purchase and don’t rush to get things sorted, Rome wasn’t built in a day.

spud73

Thanks @MrFrugalFever that seems like a good option for me too. I would have had everything I needed easily if we hadn’t had this massive change in circumstances. I will definitely wait until after completion as I don’t want anything to put this at risk. We were supposed to move six months into covid so have waited such a long time. A few weeks more isn’t going to make much difference. 

In the meantime does soft searching show up at all? 

Thanks to everyone on this board for being so clear about the risks. 

MovingForwards

Don't have any searches done, wait until the solicitor says you can get the keys. Honestly, it's not worth the risk.

we_mean_clean

Agree with the 'wait til completed' comments. Interior can wait I would imagine and you don't want to get stung if the house falls through after getting a loan? 

bargainbetty

You can also apply for finance to get the stairlift installed, depending on which company you use:

https://www.haltonstairliftsltd.co.uk/stairlift-finance-terms/

Same for carpets - just don't jeopardise the whole process by applying too soon. 

spud73

So I waited following the advice given on here and am due to completed tomorrow. 

Haven’t gone near any credit applications at all but plan to on Thurs/Fri. 

Would loan or credit card be best- would be around £5000 and paid off gradually. Also would I be best doing a soft search first? 

I would ideally like to get a loan and go through my current bank if possible. However without knowing if I’d be accepted wonder if a negative application would damage my credit rating and could then lose the opportunity to take out credit cards or loans I had a 100 percent chance of being accepted for when I looked. 

I’ve never really used a lot of credit before so am quite inexperienced at it all? 

Would appreciate any advice please

[Deleted User]

One search doesn't lose you the opportunity to apply for more.

I would start with a credit card and see what you get. With a thin file, you may not get the limit you want (or at all), but you need to start somewhere.

Ebe_Scrooge

spud73 said:

wonder if a negative application would damage my credit rating

The outcome of an application is not recorded.  The fact that a search was performed will be seen on your credit files, but no other lender will see whether it was approved or declined.

spud73 said:

Would loan or credit card be best- would be around £5000 and paid off gradually.

You need to be a bit careful here - what does "paid off gradually" mean?  If you put the purchase on a standard, interest-bearing card, then you'll end up paying a small fortune in interest if you can't clear it every month.  If you can get a 0% purchase card (and assuming the supplier will accept payment by CC), then this might be a plan - just as long as you can make sure you clear the card by the time the 0% promotion ends.

Failing that, a loan might be the more sensible option - lower interest rates, but over a longer period of time.

Depends really on how long you'll be needing to borrow the money for.  A few months - credit card would probably be the best option, even allowing for the high interest rates.  More than a few months - a personal loan would be worth looking at.  But do the sums, and work out the overall cost to you.

Kace2022

spud73 said:

Don’t want to risk completing then not being able to live in it for months due to not being able to get basics if for some reason I can’t get a loan after that. Might ring the mortgage broker and see if they can advise anything otherwise wait till the mortgage goes through but I feel like that’s a huge risk for me.
if I’m going to lose the house anyway I feel like I might as well apply for the loan 

and hope it does all go through, I know that sounds really stupid but is it possible? 

Have you asked yourself how would you feel if the bank revoke your mortgage offer because of the credit application you made for the loan?  If you'd feel ok, then crack on mate.  

MovingForwards

Kace2022 said:

spud73 said:

Don’t want to risk completing then not being able to live in it for months due to not being able to get basics if for some reason I can’t get a loan after that. Might ring the mortgage broker and see if they can advise anything otherwise wait till the mortgage goes through but I feel like that’s a huge risk for me.
if I’m going to lose the house anyway I feel like I might as well apply for the loan 

and hope it does all go through, I know that sounds really stupid but is it possible? 

Have you asked yourself how would you feel if the bank revoke your mortgage offer because of the credit application you made for the loan?  If you'd feel ok, then crack on mate.  

OP is waiting until after completion, as they've said several times since their first post.