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  • FIRST POST
    • shopaholicno1
    • By shopaholicno1 5th Mar 18, 11:30 AM
    • 129Posts
    • 474Thanks
    shopaholicno1
    Applying for mortgage with recently paid off debt
    • #1
    • 5th Mar 18, 11:30 AM
    Applying for mortgage with recently paid off debt 5th Mar 18 at 11:30 AM
    I recently (a week ago) cleared my next account balance to 0 from
    600
    However, as it's so recent it's still showing on my credit file at 1400, which is what the balance stood at 5 weeks ago now.

    We have seen a house, and want to apply for a mortgage. Can my mortgage broker inform a lender the debt has been recently paid? Do I need to state I do have a debt even though it is paid off on the forms when applying?
Page 1
    • SharkBite
    • By SharkBite 5th Mar 18, 11:39 AM
    • 40 Posts
    • 26 Thanks
    SharkBite
    • #2
    • 5th Mar 18, 11:39 AM
    • #2
    • 5th Mar 18, 11:39 AM
    Depends on the lender I think. Most have an option stating the debt will be / has been settled.

    I recently had this when I applied with Natwest. I included debts on the application even though I had settled them. But I was able to tick a box saying they will be repaid before completion.

    They didn't query anything and my settled accounts were much larger than 600.

    The main thing is the affordability model each lender uses.

    I'm in no way an expert BTW just talking from recent experience.
    • juniordoc
    • By juniordoc 5th Mar 18, 12:07 PM
    • 364 Posts
    • 286 Thanks
    juniordoc
    • #3
    • 5th Mar 18, 12:07 PM
    • #3
    • 5th Mar 18, 12:07 PM
    You don't need to apply for a mortgage until your offer has been accepted. A premature application will show up on your credit file. If your seller also has to find somewhere to buy then there may be no point sending off your application for a couple of weeks yet.
    When you do get round to sending off the application, as above mention that these debts are recently settled.
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