Probably a stupid question, but are there any borrowing implications just from having, but not using, an overdraft facility (£500) and two empty credit cards (cc limits of £9k and £4k I think), before applying for an addition to our mortgage?
Is it best to just get rid of the credit cards, and remove the overdraft facility before we apply? Or are they signs that other people are prepared to lend to us and therefore they're a good thing? I am so clueless!
If it's relevant, we're looking to borrow an extra £40k on top of our £170k loan - house worth about £450k; joint income of £100k.
I started a new (better paid) job in the summer but I would say that before that we were always scrabbling for the last penny at the end of the month, so we have been using the overdraft, but not exceeding it. Likewise, the credit cards have been used (up to a max of c.£3k) but have always paid off in big chunks and have now finally cleared them.
We are getting work done in Spring next year so I am trying to get my ducks in a row before making the application to minimise chance of being refused as friends who I had always thought were in a similar position to us, did recently get declined when they applied to borrow more. We were also declined a few years ago when we applied, but I was only working three days a week then (now work 4) and my full time equiv package is better now than it was; I think we also had a chunky credit card debt when we last applied.
For e.g. would we need to have been credit card free for a certain period (3mths) for it to look best on our
Any other tips on things to consider would be great.