Any mortgage advisors on here?

[Leavingbyebye]

If so, I have a few questions!

• who should be the lead borrower? One of us has a much higher income but has the household debt (car loan, home improvement loan, credit card. All in good standing but add up). One lower but no debt

• what benefit is there to the lenders credit score if we scrape together a slightly larger deposit and go from 81% LTV down to 79%?

• kind of related to the first question, how do lenders view debt full stop? DH has quite a lot in his name but his salary covers it three times over. But we are still worried the total balances will scare a lender away

We have found our dream home but the above questions are nagging away at me and I haven’t appointed a mortgage advisor as we are stuck in a current deal with a chunky early repayment fee (albeit portable)

- who should be the lead borrower? One of us has a much higher income but has the household debt (car loan, home improvement loan, credit card. All in good standing but add up). One lower but no debt

“Lead borrower” isn’t really a “thing” for joint applications - your combined income and debts will all be factored in.

- what benefit is there to the lenders credit score if we scrape together a slightly larger deposit and go from 81% LTV down to 79%?

I don’t think this will make a difference with such a small change in %, although of course, 79% LTV is a teeny bit less risky than 81%! If you can get to 75% LTV this might make a difference, and would likely get you access to slightly better mortgage rates (usually lenders have rates for 90% LTV and then 75% LTV)

- kind of related to the first question, how do lenders view debt full stop? DH has quite a lot in his name but his salary covers it three times over. But we are still worried the total balances will scare a lender away

Debt isn’t always a bad thing....as long as it is affordable - I.e. paid on time each month! Regularly paying off a credit card balance in full each month (for e.g) can actually help to increase your credit score.

We have found our dream home but the above questions are nagging away at me and I haven’t appointed a mortgage advisor as we are stuck in a current deal with a chunky early repayment fee (albeit portable)

Go and talk to them! You can get a new deal for any additional borrowing, and your adviser should also be able to do the calculations to see if paying off the repayment fee for your existing deal would be worth it long term.

Good luck - I hope it does become your dream home.

Thank you very much @MrsKipling16 really appreciate you taking the time to reply

Will get a call booked in with the mortgage provider. We are actually only ‘topping up’ by less than 20% but I presume this still involves a full application

We don’t pay the credit card off in full, in fact it’s been carrying a large balance for a while. The payments are affordable and my DH also gets annual bonuses which typically pay it right down. But this time we’ve put the bonus in savings towards moving / additional deposit, just don’t know what the lender will view as ‘better’ or worse - a higher deposit or less debt?

I think there are a couple of things to consider.

79% vs 81% isn't a huge difference but it may open up better rates for you. In my case the difference was .5% so it is worth exploring.

Also, unsecured debt isn't great. Although it won't stop you from getting a mortgage it will make a big difference to how much the lender is willing to give you. Different lenders have different rules but as a rule of thumb the tend to consider a 10k loan/credit card balance as a 40k liability. If you are not hoping to borrow at the limits of your affordability it's fine but if you are hoping to borrow close to the limits you may want to reduce your debts.

We are only hoping to borrow half of what the max loan indicated is (and the max loan was after inputting the debt commitments)

We’ve literally not thought anything of having the debt as it’s so affordable and has been for home improvements and car, primarily, but now I’m worried

You should be fine then. The only thing dent limits is the amount the bank is willing to lend you.

We got a good mortgage with a high amount of debt. Our debt was affordable on our salaries so they weren’t bothered.

Thank you!! That’s such a relief.

I’ve made an appointment to speak to them via video call next week so I will report back.

Yes, any amount of top up still requires a new application.

From what you’ve said about only needing to borrow half of the maximum amount indicated with the debts considered, you should be fine though.

I’m not sure on the higher deposit vs less debt debate for all lenders, but for my employer, it is affordability that is key - and from what you’ve said, your “level” of debt is affordable for you - an equivalent “level” of debt for someone with different circumstances (LTV, income, no of children, disposable income, credit history, etc, etc) might not be viewed in the same way.

You’ve done the right thing making the appointment - you’ll get some good advice, specific to your circumstances x