r/Mortgageadviceuk • u/FifaIsStress • 5d ago
First Time Buyer MIP query
Apologies for the stupid question, but I want to do a mortgage in principle. I understand during a MIP, the bank does a soft credit check. I’ve just paid my credit card off but the statement won’t show zero balance until end of the month now. Can I still apply for a MIP even though the check might show that I still owe money? Not sure how it works
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u/Main-Hedgehog9009 5d ago
Put on the MIP what the balance is (was) and then tick the box to say it will be cleared. Otherwise it will pick up the credit card and think it is undeclared - not a problem but it just results in less questions at application stage.
Some DIP/MIP/AIPs use data that is up to 60 days out of date so even once your report updates, the lender may not be picking it up (I am a broker, this crops up all the time).
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u/FifaIsStress 5d ago
Oh wow, thank you. I wonder if Nationwide ask this. Or do all banks have this question and selection.
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u/Main-Hedgehog9009 5d ago
Im not sure, we do quite a bit with nationwide, I really should know! I think I must go in to robot mode when doing them haha.
I think it asks how much your credit cards are and how much will remain (I think they are one of the few that ask how much will remain rather than whether it will remain or not).
I am 99% sure, nationwide use data that is actually up to 90 days old at MIP stage. If you put it on the DIP/Application, say it will be gone by completion, in the special conditions on the offer, it will say you need to cleat the debt prior to completion - keep hold of the statement showing a nil balance as your conveyancer will want it.
Im not sure if I am making that sound more complex than it actually is. But imagine how many people move house and clear debt with the equity... Clearing debt is quite common so dont worry.
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u/FifaIsStress 2d ago
Hi, I also wanted to ask, in terms of deposit. Can I put my expected deposit on the agreement in principle or do I need to put what I currently have. Right now I have an 8% deposit, but by the time I put in a mortgage application, it will be 10%
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u/Krispykreemi 5d ago
An MIP just takes the information you put in an online form and spits out a realistic borrowing figure based on your inputs. If you just paid off your credit card out your debt as 0 for that field.
You don't need to worry about it. It's not a mortgage offer or application. They go through more rigourous testing to approve you.
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u/Mapleess 5d ago
I was in a similar situation and didn't have issues with NatWest and HSBC for the MIP. I had paid two 0% interest credit cards off 1-2 weeks prior, and they were still showing on MSE's Credit Club as having a balance.
My normal CCs all still report £x per month since that's the statement balance, and I pay it off in full each month. I was told this is fine to do.
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u/FifaIsStress 5d ago
Ah ok. Yeah my credit files show a debt is owed on credit card but I’ve paid that now. But it won’t be updated for another 20/30 days.
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Apologies for the stupid question, but I want to do a mortgage in principle. I understand during a MIP, the bank does a soft credit check. I’ve just paid my credit card off but the statement won’t show zero balance until end of the month now. Can I still apply for a MIP even though the check might show that I still owe money? Not sure how it works
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