Debt vs Deposit

[seismic22]

Hi All,

Looking to purchase my first house later this year. I have circa £20k savings at the moment and hope to increase this 25% by late summer to use as a deposit. I also have just under £5k on an interest free credit card.

I am yet to speak to a mortgage broker/adviser. Prior to doing this can anyone on here offer any advice as to what would be most beneficial in terms of obtaining a mortgage/purchasing a property:

• Retain debt and use all savings as deposit but perhaps consequently reduce my borrowing ability

or

• Pay off debt and use reduced savings as a smaller deposit

Any friendly advice welcomed. Thanks

[Sarnie]

To be able to answer, we'd need to know your income and how much you were intending to borrow

[seismic22]

Salary circa £37,000 - Intention to borrow circa £150,000 ish though this is dependent on the property.

Thanks

[Sarnie]

seismic22 said:

Salary circa £37,000 - Intention to borrow circa £150,000 ish though this is dependent on the property.

Thanks

You'd be fine keeping the credit card balance on those figures, your income could bear the impact of it on your affordability....

[seismic22]

Thanks Sarnie, really appreciate your advice. Is there a simple calculation for working that out?

Thanks again.

[Sarnie]

seismic22 said:

Thanks Sarnie, really appreciate your advice. Is there a simple calculation for working that out?

Thanks again.

Not really anymore.....just experience

There will be lots of online calculators but they will all vary massively......but if a client of mine approached me with those requirements, I wouldn't be concerned about placing that mortgage......however, that would change if that £150k figure started creeping upwards and anything over £170k would start to get tight.......

[seismic22]

Really helpful and much appreciated advice. Thanks.

P.S Nice 12c!