Releasing equity from sale to pay loans when moving house

anewloginapparently

Hi,

I am going to be moving house soon. 

I have a flat worth £125k with about £50k of equity in it and 22 years left on the mortgage.

I have £8k left on a personal loan, £1750 on my credit card and I have a car that is £153pm but is coming to the end of it's PCP deal now (and will be worth substantially more than the payments left) 

I will be buying another property for a similar amount. But when I put the loan payments into the mortgage in principle calculator HSBC won't lend me enough money. 

My plan however is to pay off the loan and credit card from equity from my sale and put down a smaller deposit on the new place (circa £30k). 

Is this something that is allowed? How do I best illustrate this on my application?

Thanks in advance.

lisyloo

So your mortgage is around £75k? (125-50)
you have £9750 in loans

So you need to borrow £85k to clear the mortgage and the loans?

if HSBC won’t allow it then they think you can’t afford it.
its allowed if a mortgage provider thinks you can afford it.
it sounds like they think you can’t for some reason.

is it clear that you will be paying off the loans so won’t have the loan payments afterwards?

as regards filling out the form you’d need to ask HSBC as we don’t have a copy.

make sure they understand you won’t have to pay the loans plus the mortgage afterwards because you will have paid the loans off.

kingstreet

Mark any credit to be repaid on/before completion "to be repaid on or before completion."

Some lenders will ignore credit marked thus, others won't and will tax your affordability as if it will still remain in place.

anewloginapparently

kingstreet said:

Mark any credit to be repaid on/before completion "to be repaid on or before completion."

Some lenders will ignore credit marked thus, others won't and will tax your affordability as if it will still remain in place.

Thanks,

Just had a very helpful chat with an advisor at the Halifax who has helped me apply doing this. Much appreciated!!!