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  • FIRST POST
    • Norwooder
    • By Norwooder 7th Mar 18, 3:58 PM
    • 10Posts
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    Norwooder
    Agreement in Principle & Credit Card Stoozing
    • #1
    • 7th Mar 18, 3:58 PM
    Agreement in Principle & Credit Card Stoozing 7th Mar 18 at 3:58 PM
    Flat going on the market shortly and beginning to think about finance for a house purchase (which will involve obtaining additional mortgage finance). Currently have a reasonable amount (5k-10k) on a purchases card on a 0% deal which has another year to run. At the time I do the formal mortgage application process I will clear the credit card with existing cash savings. Two questions:

    - Is it fraudulent / problematic to state that I have no / minimal credit card debt when obtaining a decision in principle (on the basis of nil net debt and intention to repay in full prior to formal application)?

    - How long before starting the full application should I pay off the credit card, to be sure that it will update when searches are run by the bank?

    Thank you
Page 1
    • new_owner
    • By new_owner 7th Mar 18, 4:47 PM
    • 211 Posts
    • 75 Thanks
    new_owner
    • #2
    • 7th Mar 18, 4:47 PM
    • #2
    • 7th Mar 18, 4:47 PM
    I was in a similar situation when getting my mortgage a few weeks ago. I just showed them that the money to repay the card was sitting in an account and it could be paid off at any time.

    They required this due to me wanting to borrow a 5x multiplier which I did and sent them proof the card was at zero.
    It made no difference to me getting the mortgage all be it took a smidge longer having to post my card statement.
    Last edited by new_owner; 07-03-2018 at 4:48 PM. Reason: spelling
    • Thrugelmir
    • By Thrugelmir 7th Mar 18, 7:11 PM
    • 58,460 Posts
    • 51,837 Thanks
    Thrugelmir
    • #3
    • 7th Mar 18, 7:11 PM
    • #3
    • 7th Mar 18, 7:11 PM

    - Is it fraudulent / problematic to state that I have no / minimal credit card debt when obtaining a decision in principle (on the basis of nil net debt and intention to repay in full prior to formal application)?
    Originally posted by Norwooder
    A DIP is not an application. Nor is it a formal offer to lend. Though the debt potentially could influence the DIP when it is prepared. The lender will have set internal policies, your word will have no bearing.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
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