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Will my old overdraft affect my mortgage application?

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  • 11-10-2014 10:07pm
    #1
    Lucy B
    Registered Users Posts: 97 ✭✭


    Just sitting here thinking and remembered that probably about a year ago, I was in overdraft on my current account for about 6 months!!! It was max 350 ever and I am approved for 700. Have never ever used that amount. It was just pure bad money management on my part, fixed it a year ago, and have been clean ever since. We are hoping to apply for mortgage in April, will this affect my credit rating?


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    #2
    coylemj
    Registered Users Posts: 25,437 ✭✭✭✭coylemj


    Are you potentially applying to a different bank for a mortgage and are worried about your record with the Irish Credit Bureau (ICB)?

    If you were overdrawn but within an approved limit it will have no effect whatsoever on your ICB credit record. Might even be a plus as it shows that you had credit extended to you, you used it and stayed within the agreed limits.

    If you're applying to the same bank, they may have an unwritten rule which says that you should be in the black (in credit) at least twice a year or once a quarter, you can ask them about this but as long as you stayed within the agreed overdraft limit, your record as far as they are concerned should be clean.


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    #3
    Lucy B
    Registered Users Posts: 97 ✭✭Lucy B


    Thanks for reply, I can go to sleep now at least, was worrying like mad. The overdraft was agreed limit yes. Have it for years and never really used it. The amount was under the 700 agreed overdraft limit, but was worried because I didn't fix it for ages, but am fine now the last year. Never in the red.

    Was just worrying that I would have awful credit rating because of it. So I'm ok so? If it was an agreed overdraft?


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    #4
    coylemj
    Registered Users Posts: 25,437 ✭✭✭✭coylemj


    Lucy B wrote: »
    So I'm ok so? If it was an agreed overdraft?

    Two more questions marks :confused:

    Can't you get the message - you asked for credit, you got it, you used it within the agreed limits. How could that be a black mark against you?

    It's how banks make profits, they lend you money and you pay them interest at a rate higher than they pay depositors so will you stop worrying FFS.


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    #5
    BuffyBot
    Registered Users Posts: 24,924 ✭✭✭✭BuffyBot


    coylemj wrote: »
    Two more questions marks :confused:

    Can't you get the message - you asked for credit, you got it, you used it within the agreed limits. How could that be a black mark against you?

    It's how banks make profits, they lend you money and you pay them interest at a rate higher than they pay depositors so will you stop worrying FFS.

    Please watch the tone of your posts. The main purpose of this forum is for people to ask such questions


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    #6
    Lucy B
    Registered Users Posts: 97 ✭✭Lucy B


    coylemj wrote: »
    Two more questions marks :confused:

    Can't you get the message - you asked for credit, you got it, you used it within the agreed limits. How could that be a black mark against you?

    It's how banks make profits, they lend you money and you pay them interest at a rate higher than they pay depositors so will you stop worrying FFS.

    Crickey, relax!! Have no idea what affects your bloomin credit rating and what doesnt in terms of niggly things. Jeez thanks for your, eh help.


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    #7
    Trish56
    Registered Users Posts: 1,256 ✭✭✭Trish56


    Lucy B wrote: »
    Just sitting here thinking and remembered that probably about a year ago, I was in overdraft on my current account for about 6 months!!! It was max 350 ever and I am approved for 700. Have never ever used that amount. It was just pure bad money management on my part, fixed it a year ago, and have been clean ever since. We are hoping to apply for mortgage in April, will this affect my credit rating?

    Lucy, No need to worry whatsoever having an overdraft approved and using it. The only way you get black marks is not having an overdraft and going overdrawn, having referral fees and unpaids. If you are applying for a mortgage the bank will want to see regular monthly savings and or rent equal to stressed monthly repayments and a well managed current account for the past 6 to 12 months.

    Best of luck with your mortgage application.


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    #8
    Lucy B
    Registered Users Posts: 97 ✭✭Lucy B


    Thanks trish. Phew!

    One more silly question now, we had a joint credit union loan, and say a week here and there, we would have missed a payment and the following week would be in arrears then. Loan was paid off over a year ago. Would those arrears affect our credit rating? I'm sorry if it is a silly question, but I generally have no idea as to the exact things despite the obvious that would affect your rating.

    Thanks again, great to get answers rather than sit here worrying myself.


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    #9
    kerry4sam
    Registered Users Posts: 15,127 ✭✭✭✭kerry4sam


    Lucy B wrote: »
    Thanks trish. Phew!

    One more silly question now, we had a joint credit union loan, and say a week here and there, we would have missed a payment and the following week would be in arrears then. Loan was paid off over a year ago. Would those arrears affect our credit rating? I'm sorry if it is a silly question, but I generally have no idea as to the exact things despite the obvious that would affect your rating.

    Thanks again, great to get answers rather than sit here worrying myself.

    I had so many questions going through my own mind recently, asked in 'Ask AIB' on here and also went onto ICB right here and received my own Irish Credit Bureau Credit Report within days. Seriously put my own mind at ease. Lost so much sleep, but nothing to worry about according to my report.

    Hope that helps,
    kerry4sam


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    #10
    Lucy B
    Registered Users Posts: 97 ✭✭Lucy B


    Thanks, that's what himself was saying tonight, get an icb report, probably so he won't have to listen to me anymore!!!! :) where is the ask aib thread? Is it in this section? Will ask there so.

    Thanks, appreciate it. This finance stuff is stressful and worrying seeing as the banks are fussy.


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    #11
    kerry4sam
    Registered Users Posts: 15,127 ✭✭✭✭kerry4sam


    Lucy B wrote: »
    Thanks, that's what himself was saying tonight, get an icb report, probably so he won't have to listen to me anymore!!!! :) where is the ask aib thread? Is it in this section? Will ask there so.

    Thanks, appreciate it. This finance stuff is stressful and worrying seeing as the banks are fussy.

    Talk-to AIB linkie right here :)


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    #12
    SBarrett
    Registered Users Posts: 160 ✭✭SBarrett


    kerry4sam wrote: »
    I had so many questions going through my own mind recently, asked in 'Ask AIB' on here and also went onto ICB right here and received my own Irish Credit Bureau Credit Report within days. Seriously put my own mind at ease. Lost so much sleep, but nothing to worry about according to my report.

    Hope that helps,
    kerry4sam

    I was going to post the same. Everyone looking for a mortgage should get their ICB record before going through all the hassle that is required. It costs €6 and you have it in a couple of days. It will show all your loans and whether the payments in the previous 2 years were paid on time or not.

    Steven


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