Payday loan, future house move

Trebor2013

Hi there.

I am a home owner, joint mortgage with my wife, with a view to moving home in 2025/2026.

I have recently been in a challenging spot, whereby last month I had to use 2 x payday loans, £750 combined, (both paid back in 5 days of receiving funds), and I’m in a similar position today, whereby my only possible option is a payday loan of £250, but expected to be paid back in 14 days once funds cleared. We’ve just cleared our reserves in our joint current account (around £800) for unexpected breakdowns with cars and household appliances in the space of a couple weeks.

To manage my expectations, and I know nobody has a crystal ball for two years time, but has anybody had any previous experiences similar with payday loans/mortgage applications and how they found it? I’m mindful how negatively payday loans look on credit files, particularly high street lenders, so interested to know how other people found the experience when applying for a mortgage, particular if looking to increase in line with a house move.

I foresee no reason this will be recurrence as the money that is going to be used to pay off the loan is from an investment bond (hence not a quick turnaround of receiving funds) so not impacting my monthly income.

When we come to move house, we are anticipating needing to increased our mortgage between £50-75k, due to needing to upsize.

Our current LTV is 32% (ish) with a house value of £280k and mortgage of £99k. Halifax our lender since 2013 when mortgage was taken out, with no missed payments. We typically go through a broker and have always found them very useful.

Only other black mark is a default from August 2017, which I believe is due to drop off this year, if not mistaken? Debt was cleared from that in 2019.

TheJP

Sorry you had to put yourself in the 'payday loan' pit, I've been there myself when i was younger please make that the last one for good!

All of this will depend on,

• The lenders criteria
• Your circumstances at the time
• Income v outgoing
• The property

The payday loans will stay on file for 6 years so lenders will see you have needed to use this type of lending, from research when buying my own property some will flat out refuse based on this, some will offer you a mortgage but not at the rate or amount you want/need and others will look past it in return for a high interest rate.

Another option is porting and trying to borrow extra with your current lender however this will be another full application process.

Get your finances in tip top shape between now and then!