Buy a car...then a house?

David · Joined: 19 May 2004 Posts: 754 Location: Atlanta, GA

I was wondering if buying and financing a new car now will have big affect on the house I can get six months from now. Does it make a difference if I get a new car or a used car? Does adding an extra $300/month to my expenses hurt what they are going to say I can afford for the house?

BECCA9892003 · Joined: 20 Jan 2005 Posts: 400 Location: Altoona, PA

It will effect your debt to income ratio...the only way to know is to run your figures....takes a sec then you will have a good idea where you stand..better now then the day you find your dream home to find out you don't qualify to get it....

I would need to know approx base annual income...and approx of other debts and payments you have...then we can find out your debt to income ration as it stands now

BECCA9892003 · Joined: 20 Jan 2005 Posts: 400 Location: Altoona, PA

It will effect your debt to income ratio...the only way to know is to run your figures....takes a sec then you will have a good idea where you stand..better now then the day you find your dream home to find out you don't qualify to get it....

I would need to know approx base annual income...and approx of other debts and payments you have...then we can find out your debt to income ration as it stands now

David · Joined: 19 May 2004 Posts: 754 Location: Atlanta, GA

Okay, I'll know the answer better after I do my taxes.

Nikko · Joined: 20 Jan 2005 Posts: 536 Location: Northern CA

Deadline's coming up, pal!

Sounds like me, wait until the last minute HAHA

chow · Posted: Fri Mar 18, 2005 9:36 pm Post subject:

used car financing can be more than new car financing-or visa/versa.

What does doing your taxes have to do with it unless you're self employed and going full doc? I went and bought a car when I crashed mine in Aug, and I'm going to refi it to a lower rate. For a shorter term. If I had to go on a home loan right now-I would be going stated, and the bump for that with my credit score isn't much compared to the finance charges I would carry on a new car for 5 years. At this point I could move that car loan around to interest free credit cards for 2 years, and be done with it.

now a lesson on buying "stuff" on credit.

Never have more than 4 credit cards open. Never use more than 50% of the limit, and never go late on a revolving account. Don't do Finance company accounts-90 day, 6 month, or a year or two same as cash. IF You pay it off early,you always pay a Prepayment Fee. You may as well just stick it on an interest free card and pay it down quick!

$10,000 in Revolving credit dollars, made at required payments-per month, at 18% APR cost you $1800.00 per year. If you have $10,000 @6% APR your cost for borrowing is $600 per year at required payments.

If you pay it down faster-you spend less on APR. This is why looking at what is the best APR offered was passed as a law-IE the Truth and Comfewsion disclosure-that 90% of the LO's can not explain.

David · Joined: 19 May 2004 Posts: 754 Location: Atlanta, GA

You've given me a lot to consider, chow. Thanks for the info.
Are you saying you converted your car loan to interest free credit cards? That's a good idea. I might look into that.
I think my car loan is going to be about 5.8%

chow · Posted: Sat Mar 19, 2005 9:56 pm Post subject:

That's a lot to put on credit card balances if you don't have money down. No-you don't buy a car on a credit card unless you're going to pay it off in a few months. (but I do buy cars on my home equity line that are more than $10,000.) 5.8% on a car isn't bad, is this used car financing? How long are you going to finance it for? Are you going to show your income when you apply for a home loan or go stated?

(see that's why Loan Officer's have a job. If people could figure out how to advise themselves on which loan is good, and what the future plans are-you wouldn't need us, would you?) 8)

Jenie0109 · Joined: 27 Jan 2009 Posts: 307 Location: chicago IL

great info. thanks for the tips.

bradley · Joined: 19 May 2009 Posts: 9

It really depends on your credit currently and the lender you are using. Personally I would get the house first then the car. The home can act as an asset to help the car loan lender say yes.

frdsmth9 · Joined: 24 May 2009 Posts: 7

We can buy the house first, then serve the installment for a few years. After we build up more equity in the mortgage, we can refinance the house to higher loan amount. The extra cash we get can be used to buy our dream car.