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loan while applying for mortgage

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  • 16-06-2006 2:48pm
    #1
    Kambika
    Closed Accounts Posts: 136 ✭✭


    Hi,

    I hope you can give me some advise. I live in Dublin/ Ireland since 5 years now and I'm interested in buying an appartment or house together with my partner. I got some information from the bank about the 100% mortgage. Now we both still have a small personal loan outstanding, it's not much but too much to clear in a short time. Now the difference the bank is willing to lend us with having a personal loan is huge. I was just wondering if the bank actually has any way of finding out that you still have a loan if the loan is with a different bank? Did anyone ever do that and lie to the bank about the loans?

    Thanks already in advance!!
    Kam


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    #2
    aniascor
    Registered Users Posts: 503 ✭✭✭aniascor


    As far as I know, the banks share information about your credit history - so yes, the banks can find out about your other loan. I don't think they share information with the credit unions though - so if it's a credit union loan, they mightn't find out.


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    #3
    godtabh
    Moderators, Science, Health & Environment Moderators Posts: 23,215 Mod ✭✭✭✭godtabh


    I think they ask you to sign a form to allow them to perform a credit check and I'm sure under that credit check all your loans past and present will be found in that.


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    #4
    gogo
    Registered Users Posts: 1,452 ✭✭✭gogo


    The bank will ask you to sign a declaration in which you agree to let them check your credit history. THis is done through the Irish credit bureau. The ICB will have a record of all present loans with all banks, but not with the credit unions.
    There is a valid reason for this, when you apply for a mortgage, they obviously have to check that you are good for the repayments, but they also stress test you, to see if you can afford the repayments if there is an interest hike, or for any unforseen circumstances which you might not have allowed for in your future budget.(it would be very hard to stress test you if you had a loan they didn't know about)
    I personally wouldnt lie about any loan when applying for a mortgage, believe it or not most financial instituations don't want to see you a year down the road happily settled in your new house, yet unable to repay the mortgage, it dosent make anyone happy, you more so.

    Btw you don't have to sign the declaration, but i personally haven't seen anyone get a mortgage who dosen't.

    good luck.


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    #5
    Kambika
    Closed Accounts Posts: 136 ✭✭Kambika


    Thanks for the replies. I decided to pay off the loan before I apply for the mortgage :)


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