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  • FIRST POST
    • The_Analyst
    • By The_Analyst 11th Jul 18, 11:05 AM
    • 68Posts
    • 90Thanks
    The_Analyst
    Mortgage Application - Debts
    • #1
    • 11th Jul 18, 11:05 AM
    Mortgage Application - Debts 11th Jul 18 at 11:05 AM
    Looking for some advice from this forum. My wife and I are shortly in the process of applying for a new mortgage as we have decided now is the time to move house.
    I have to wait until end of August to apply as I am self-employed and my mortgage broker needs 12 month's accounts in order to process the application.

    In terms of our credit status/affordability/eligibility for the loan I foresee no problems as I'm fortunate enough to me able to pay some sizeable dividends from my business account.

    What I'm wondering is whether to pay off the outstanding loans we have prior to applying. Between us, we have 3 loans that total 840 per month and have 5 payments left on each (total balance is 5000)

    Is it worth me paying off these loans before applying so as to show we have no short term debt (no OD, credit card is always a zero balance) even though the affordability shouldn't be an issue even with the 840 taken into account.

    Guess I'm just looking for best practice - does it look better on a mortgage app if you are totally debt free? Should I be bothered if my lender assumes I have a commitment of 840pm when in reality that will be gone by Jan in any case. The loans are interest free so there is no financial benefit to paying them off early.....

    Any thoughts?
    August 2011 - Total Debts - 47,352.12
    November 2018 - Total Debts - 0
Page 1
    • Victoriap
    • By Victoriap 11th Jul 18, 12:57 PM
    • 9 Posts
    • 2 Thanks
    Victoriap
    • #2
    • 11th Jul 18, 12:57 PM
    Debts
    • #2
    • 11th Jul 18, 12:57 PM
    My broker said to pay off as much as possible as looks a lot better to mortgage companys
    • The_Analyst
    • By The_Analyst 11th Jul 18, 1:21 PM
    • 68 Posts
    • 90 Thanks
    The_Analyst
    • #3
    • 11th Jul 18, 1:21 PM
    • #3
    • 11th Jul 18, 1:21 PM
    My broker said to pay off as much as possible as looks a lot better to mortgage companys
    Originally posted by Victoriap
    Thanks Victoriap - I thought it might be the way to go even though it shouldn't make any difference to the affordability
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