Future mortgage loans are used to measure hopelessness to hide their personal spending in an effortto pass the check to pay for the loan difficulty ", according to a new study.
One in five of those who plan to apply for a mortgage in the next three years are planning towithdraw and spend more cash is to use credit or debit cards to loans cannot see what they spend their money on.
This is because under rules introduced last April, the lender must observe in detail the earnings and expenses of borrowers to make sure they can afford the loan, both now and when interest rates rise.Some lenders being their questions in forensic, demanding to know how many borrowers spend onpet food, Drycleaning and even cut hair.
But spending the cash to conceal your real outgoings can cause side effects. The lender will either useyour actual spending, as was proven in the bank statements, or the national average collated by the Office of national statistics, whichever is higher. If your actual spending is lower than average, youcould miss out on a better deal.
The research, by MoneySuperMarket comparison site, found similar rates, 20pc, said they plan tospend on the credit card and pay off the balance each month, with the hope that their currentaccount will appear healthy.
However, this is not a fool-proof plan as the lender has access to your credit report, so can see a real-time snapshot of your credit card balance at any time during the month.
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A more rational way, a noble plan to cut unnecessary spending by about 160 table a, and almost a third say they intend to pay off the debts in the House up ahead of their mortgage applications. Thisstep is very much likely to improve your chances of getting a loan.
Brokers said another way to increase your chances is to suspend the payment of pensions for some time before you apply for a loan. Some lenders calculate pension contributions as expenses, reduceyour ability to pay. Larger borrowers should be careful here-if your loan is likely to run into theretirement of the loan you might want to see that you're saving into a pension and will be able toafford to pay the debt in retirement.
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