Hi
We are looking at selling our current home and buying in a new area, closer to family and work.
We are looking at approx. 70-100k higher mortgage than what we have now. Our current mortgage is guaranteed (a portion of it), and my parents are willing to guarantee our next mortgage as well. They will guarantee 20℅ which will act as our deposit and so we can avoid LMI. Using repayment calculators we can easily service the higher mortgage, and I know the 'how much can you borrow' calculators are quite generous, but they tell us we can borrow 200k+ over what we are looking at.
I am a little concerned because last time we got our mortgage we had zero debt. This time we have 8.5k credit card debt, and 5k personal loan (all with the same bank as our mortgage). We do have some savings that would remove the credit card debt, and some of the personal loan, however we were hoping to use this towards improvements on our current house to obtain the highest price possible. I know paying down debt is always smarter, however in this instance I was thinking it would be more beneficial to give us a chance to get as much out of the sale as we can.
Does anyone have any words of wisdom that could calm my nerves?
Thanks!