Applying for mortgage 2018

missie1968

I have a credit union loan of 6000 I am currently paying back 40 a week should I be paying more in order to get my mortgage? Currently saving 1000 a month thanks

ILikeBoats

I think it would depend on your income as a whole and what disposable income you have left over.

I got my mortgage with an outstanding loan so it does happen, but I could prove I was paying back double the necessary while also having plenty of income leftover.

grahamor

You could continue saving @650 a month and put the remainder into clearing that loan in less than a year (the remaining 350 + 160 already paying off)

Then increase saving back to 1000. Use a broker when applying and then will explain what you did to repay the loan and it shouldn't be an issue.

witchgirl26

I would try to repay the loan over the saving. I chatted to a broker last year when I had a small loan & he plugged some figures in for applying for a mortgage with the loan outstanding and with it paid off. I must say I was really surprised at the difference in the amount I qualified for by paying off the loan. His advice was that if a bank asks & you show you reduced savings to clear a debt, then it will be seen in a positive light as opposed to anything else. He also said that sometimes there can be questions raised if you have a large amount of savings that would cover paying off the loan and a loan outstanding.

BBMcQ

The bank will take a rounded look at your finance. You are financially better off paying high interest loans rather than keeping money for low interest savings.

Avatar MIA

Just to add...

Clear the loan. :cool: