12 Sep 2022

Will Mortgage House Recognise If I Clear My Credit Card Balances in Full Every Month & Increase My Borrowing Capacity?

Borrowing Capacity Calculator

Yes, Mortgage House lending specialists will recognise if you clear your credit card balances in full every month and increase your borrowing capacity! In addition, clearing your credit card balances can help to boost your credit score, potentially increase your borrowing capacity, and indicate a low-risk loan to lenders and mortgage brokers.

There are various steps a potential borrower can take to further increase their borrowing capacity aside from clearing credit card balances. High-interest-rate debts can seriously limit borrowing capacities and damage credit scores, so we recommend eliminating as much debt as financially possible to increase borrowing capacity and begin improving credit scores. 

High credit card limits will damage your borrowing capacity no matter the current amount owed or how often the credit card is used. Lenders see high credit card limits as future debt and will account for credit card repayments when determining your borrowing capacity. Essentially, high credit card limits result in a lowered borrowing capacity. We recommend lowering your credit card limits and closing any credit accounts that are not currently being used, if possible, to boost your borrowing capacity. 

Keep in mind that borrowing capacity largely varies on the loan type, individual lender, financial history, loan repayment history, and family size. Do you have questions or concerns about increasing your borrowing capacity? Reach out to Mortgage House’s lending specialists today for personalized advice and assistance throughout your home-buying journey.

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