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In a give-and-take, yes. Regardless of the myth that arrears of whatsoever kind will ruin your chances, you may all the same be able to get a mortgage whilst having an outstanding debt.

When applying for a mortgage, you'll need to come beyond every bit attractive as possible to lenders. Yous might remember having whatever outstanding debt will work against you in this regard. But, at that place are still ways you can improve your odds:

  • Check your credit file – Looking at your credit report is a good identify to start. Lenders may take their ain individual criteria for who they lend to, just they volition all check your credit report. This lists past credit cards, overdrafts, fifty-fifty phone contracts. Make sure checking your credit file is first on your to-practice listing. If there are any errors, become them corrected ASAP!
  • Ostend your financial links – A financial link or clan is anyone you've had a financial human relationship with, through a joint credit bill of fare perhaps. If you're separated from someone, make sure you lot remove the financial link between yous. Should they miss a payment, this could likely reflect badly on y'all. As yous'll be affected by all types of joint accounts, it'southward worth because previous flatmates if you shared a banking concern account for bills.
  • Annals to vote – Whether you're in debt or not, if you aren't on the electoral ringlet, your chances of getting a mortgage volition exist very slim. Lenders use this data to confirm your identity, so not registering to vote could hinder your chances.

There'south no sure-fire manner of existence approved for a mortgage, fifty-fifty with a perfect credit score. All the same, it'south worth considering these points when looking to utilise. Looking for some more tips? Read our guide on getting a mortgage, specially after a debt solution.

mortgage debt

Tin you get a mortgage with credit card debt?

Only having credit carte du jour debt won't necessarily stop you getting a mortgage. However, the amount of debt you lot owe may well influence the amount lenders are willing to give y'all.

Almost lenders do empathize that sometimes credit bill of fare debt is unavoidable, and that unforeseen circumstances do warrant paying for things you can't afford at the time, such equally a car repair or boiler replacement for example.

Although credit card debt suggests to lenders that you are having financial trouble, it is not the deciding gene. One of the other main factors that will influence mortgage lenders is your debt-to-income ratio.

What is debt-to-income ratio?

Put only, your debt-to-income ratio is your monthly debt payments divided past your gross monthly income.

Lenders use your debt-to-income ratio to see if you can manage your monthly repayments. Allow's look at an example:

If you accept a monthly repayment of £250, just your monthly take-home pay is £2500, you may well be able to afford a mortgage of £450 a month.

If nevertheless your income was £1000 less at £1500 per calendar month, you would probable struggle to brand the repayments besides equally the mortgage, and so mortgage companies would be less inclined to lend to yous.

Can I consolidate my debt into a new mortgage?

If y'all're struggling with both your debt and mortgage repayments, yous may be able to consolidate your debts via a re-mortgage.

The interest rates charged on mortgages are often lower than other types of debt, credit cards for instance. For this reason, many people see consolidation as a preferred option. Credit cards are a considerably more expensive way to borrow money when compared with a mortgage.

However, we are seeing a growing number of people consolidating to pay off their debts, only to find they are in a similar situation further downwards the line. In these cases, they've dealt with the debt itself, rather than the crusade of what got them in debt in the first place.

If you're looking to get a mortgage, merely you're worried about the outcome debt volition have on your awarding, get in impact today.