Payments to parents for lodge on mortgage application

Robbobss

Hello

how will monthly regular payments to parents for lodge be looked at by a mortgage company? 

I’m on the run up to getting a mortgage and want to make sure I won’t come into any problems with my bank statements.

I just have the usually card payments and direct debits and subscriptions affordability is not an issue with me as I will more than pass that with my salary. 

However I pay a monthly payment to my mother via bank transfer to her account to help her with the runnings of the house before I get a mortgage. 

It’s not a lot it’s just no more than £500 for lodge. The description says lodge.

how will this be viewed. 

1. Will they include this in the affordability even though when I move I won’t be paying this so it shouldn’t be in my affordability. If so is there a way of stopping them doing this before they check or is it all automatic. Can you get the chance to go through your statements with the lender to iron out and explain any transactions .

2. will this go down as suspicious to the mortgage lender and in anyway have a negative effect.

3. also what is the maximum amount of cash allowed from an atm each month before they see it as a bad thing.?


4. Would drawing cash out the atm and then paying it off straight away in full be recorded differently or will it just be reported as 0 on my credit card balance if I pay it off straight away. All lenders will see is the payment to my credit card and not an atm withdrawal? 

is it worth not drawing cash out at all. I do need cash for my work so looking at the best way to draw money without causing a bad effect on my application.  Or are you allowed up to a certain amount?

All the help welcome thanks 

chanz4

wont that stop whe you move out?

Bluebell1000

When we got a mortgage we went via a broker who went through our bank statements with us to find out exactly what each outgoing was, and what was due to stop / change after moving. 

propertyrental

Is this a lodge in the grounds of your mother's private estate?

csswiift

propertyrental said:

Is this a lodge in the grounds of your mother's private estate?

Im unsure if that’s a facetious comment however, I’m pretty certain they mean digs for staying at home.

Lomast

csswiift said:

propertyrental said:

Is this a lodge in the grounds of your mother's private estate?

Im unsure if that’s a facetious comment however, I’m pretty certain they mean digs for staying at home.

I think you are right but agree with propertyrental that it's a very unusual description that may raise questions, lodgings would be the normal way of describing it.
OP I don't think it will cause you any issues but your mortgage broker may well ask you to explain it.

ArbitraryRandom

Robbobss said:

3. also what is the maximum amount of cash allowed from an atm each month before they see it as a bad thing.?


4. Would drawing cash out the atm and then paying it off straight away in full be recorded differently or will it just be reported as 0 on my credit card balance if I pay it off straight away. All lenders will see is the payment to my credit card and not an atm withdrawal? 

This bit caught my eye. 

There is no 'maximum amount' because it depends on affordability. If it's a regular outgoing they will factor that in as a cost (be it for groceries, clothes or whatever). 

I don't know about your mortgage lenders' affordability assessments (it can vary from lender to lender so I don't know if your lender would consider it) but a 'cash advance' (aka taking cash from an atm using a credit card) can be viewed negatively by lenders and the transaction is visible on your credit report/statements. 

More info on why it's a bad idea (in general, not just in this situation) here: https://www.finder.com/uk/cash-advance-credit-score

Just be honest about it - Paying what is essentially rent to your parents for accommodation won't be a problem.

You might be asked about it and all you have to do is explain what the payment is for and that it will stop when you move out (assuming that is the case). 

housebuyer143

When you say credit card do you actually mean you are withdrawing cash from your credit card? Not sure about credit implications but cash advance cost money so doesn't make any sense to do this.
You are better sending the money where you want or to your debit account with PayPal family and friends.

kingstreet

Robbobss said:

Hello

how will monthly regular payments to parents for lodge be looked at by a mortgage company? 

I’m on the run up to getting a mortgage and want to make sure I won’t come into any problems with my bank statements.

I just have the usually card payments and direct debits and subscriptions affordability is not an issue with me as I will more than pass that with my salary. 

However I pay a monthly payment to my mother via bank transfer to her account to help her with the runnings of the house before I get a mortgage. 

It’s not a lot it’s just no more than £500 for lodge. The description says lodge.

how will this be viewed. 

1. Will they include this in the affordability even though when I move I won’t be paying this so it shouldn’t be in my affordability. If so is there a way of stopping them doing this before they check or is it all automatic. Can you get the chance to go through your statements with the lender to iron out and explain any transactions .

2. will this go down as suspicious to the mortgage lender and in anyway have a negative effect.

3. also what is the maximum amount of cash allowed from an atm each month before they see it as a bad thing.?


4. Would drawing cash out the atm and then paying it off straight away in full be recorded differently or will it just be reported as 0 on my credit card balance if I pay it off straight away. All lenders will see is the payment to my credit card and not an atm withdrawal? 

is it worth not drawing cash out at all. I do need cash for my work so looking at the best way to draw money without causing a bad effect on my application.  Or are you allowed up to a certain amount?

All the help welcome thanks 

1. No. Ignore it.

2. No. Leave it alone and carry on as normal.

3. Nil. It's your money.

4. Drawing out of the ATM and paying what off?

Please get advice from a decent broker. You seem to have all kinds of unwarranted anxieties and should do nothing until you have that advice.

FarmGirl78

csswiift said:

propertyrental said:

Is this a lodge in the grounds of your mother's private estate?

Im unsure if that’s a facetious comment however, I’m pretty certain they mean digs for staying at home.

I too read it as "lodge" as in they had a holiday home log cabin or static caravan thing they paid towards as a family. OP, "Board and lodgings" may be a better way of describing it on your outgoing standing order to make it a little clearer to anyone looking over your bank statements.

3 and 4...If you're withdrawing cash on your CREDIT card on a regular basis that's a VERY bad thing. Get out of that habit asap, not just for potential mortgage applications but for your own future financial security. It'll only end up biting you on the !!!!!!.

Robbobss

Thanks guys 

this is good advice I’ll change the description to maybe rent? Then if asked explain it’s given to my mother each month and will stop when moved out.

also I made a mistake I meant cash out of atms from my normal account. I guess this is just about affordability so best to just use my card for food purchases etc and draw a little bit of cash each month for my travel