MORTGAGE ADVICE PLEASE

[jesssicalou]

I'm not too sure if this is on the right topic as I've just made my account for some advice, I've looked at a few threads but can't find the exact answer to my question.

Me and my partner are looking at applying for a mortgage at the beginning of January.

We don't have anything on finance, or any other debts. Both of our credit scores are above 950. We have a £8250 deposit and are wanting to buy a £165,000 house with the help to buy scheme, so are wanting a £123,750 mortgage.

I earn £15,600/year and my partner £18,000/year, and we also get over £1,000/year child benefit.

We got buy now pay later credit cards from Currys (£4,000 limit, used £1100 which we payed off yesterday and now the balance is now £0) and also a buy now pay later Argos card (£600 limit, used £585 which we also paid off yesterday, balance is now £0). By the time we come to get a mortgage these cards will be 6/7months old, so would it be best to close these cards as they are still quite new, or would it be best to keep them?

Also anything else we can do in the next 3 months to improve our chances of being accepted for a mortgage and any other general advice would be appreciated, thank you!!

Sounds like you've got all your ducks in a row. Keep the cards open as it shows you have access to credit but don't use it/pay it off in full.

Definitely close the credit cards. Even at £0 balance they still show that you could potentially spend that money.

In terms of improving your chances of acceptability, make sure your bank statements in the months prior to mortgage application are clean; by this I mean no gambling bills, payday loans, huge shopping trips/going out/etc. They will assess your affordability and if your statements shows regular expensive hobbies this amount will be reduced from the amount bank will lend.

Do not close your cards. Having cards and being in control of them - paying them off is a massive tick for credit.

To enhance your credit score, spend £100-£300 per month on a credit card and pay it off in full as soon as the bill arrives. Demonstrating ability to use and pay off credit regularly every month is much better for your score than not using credit and closing down the cards you have.

You sound like you’ll definitely be approved myself and my partner were and our circumstances are similar, well worse than yours as i have a loan and car finance. I wouldnt worry about the credit cards personally. Good luck x

Keep the cards, make sure you're on the electoral roll. Is there any reason you're waiting until January to apply? If you want to move in january, you could apply now as offers are usually valid for 6 months.

Thanks for all the help guys!

The reason we're wanting to wait is purely because they ask for 3 months of bank statements and we've done a lot of spending in the past 3 months (holiday, meals) but have stopped now. So thought we'd have the best chance in January as we'd have good statements with nothing going out other than a phone bill each (£30/month).

Would prefer to have everything as perfect as possible for our application, don't want to look like we spend spend spend.

I think you're doing all the right things.

I'd use the credit cards & pay them off in full each month. That seems to be the preferred thing by lenders.

Good luck.

We have applied for 3 mortgages recently (ugh, fingers crossed 3rd time lucky with buying for us) and all the banks seemed bothered with regarding past 3 months statements was the page which our salaries were paid into, i.e. so that it matched up with the pay slips we provided.

Also they were only bothered about our spending commitments, i.e. any payments you cant stop (e.g. council tax, outstanding loans/credit cards etc) not that we ate out too much.

Agree to keep the cards - spend a little on them and pay straight off to show you are a good payer.

You sound like you're doing it all right.