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Answers (14)
- Jon Goldstein, "cbsirealty"
- Contributions:199
When going for a loan, the banks look at your debt to income ratio. If everything else as far as credit, assets and income are good and you don't have much other debt, you should be ok. While going for a loan do not take on any more debt. Don't apply for any credit cards, buy any more cars, etc....
There are a number of factors that go into cosideration when applying for a mortgage, so the best advice is to talk to a mortgage broker or a bank. They will guide you in the right direction.
There are a number of factors that go into cosideration when applying for a mortgage, so the best advice is to talk to a mortgage broker or a bank. They will guide you in the right direction.
- Mar Nygard, "Mar Nygard 2"
- Contributions:4
The purchase of your car may change your ability to obtain a Mortgage if your debt to income ratio is too high. A lender should be able to let you know. Mar
- Cheryl Talbot Real Estate, "Virginia Beach Homes"
- Contributions:674
First and foremost, don't buy another thing until you talk with a lender. That being said, a lender will be able to look at your income and debt ratios as well as your credit score to see if you in fact can purchase. I would find out for sure that you can or can not buy at this time before I purchase anything else. You can find a trusted lender through your bank. They are the specialist in getting us a home loan and they know what it takes. Try them first so that you can at least know where to go from here. It's free and they are there to assist you. Thank you for your question.
- SteadyState
- Contributions:787
If the two of you are so close to the "edge" on procuring loan you may want to wait an collect a more substantial down payment and repair your credit even more before you buy. Also, it appears you bought a new car and paid an additional $10K (you may not have learned from your past mistakes depending on your income).
Do not. Repeat, do not, contact a loan officer or an REA without getting your financial house in order. You may be encouraged to bite off more than you can chew and may become another statistic for short sales or foreclosure.
Do not. Repeat, do not, contact a loan officer or an REA without getting your financial house in order. You may be encouraged to bite off more than you can chew and may become another statistic for short sales or foreclosure.
- Matt Daley, "MattDaleyRealEstate"
- Contributions:36
Just make sure you speak to your specific Loan officer. He is really the only one who can answer that questions. Best of Luck!
- Benjamin R. Everett, "BenjaminREverett"
- Contributions:33
phoenix98,
I think you've been given very good advice below. As such I do not have much more to add.
However, I would say, just go straight to the decision maker:: Why don't you talk to a loan officer and find out? Then all this chatter is unnecessary and you'll have concrete answers to your questions.
I would be happy to recommend a few people to you.
Hope that helps. Let me know if you have any other questions.
Ben
I think you've been given very good advice below. As such I do not have much more to add.
However, I would say, just go straight to the decision maker:: Why don't you talk to a loan officer and find out? Then all this chatter is unnecessary and you'll have concrete answers to your questions.
I would be happy to recommend a few people to you.
Hope that helps. Let me know if you have any other questions.
Ben
- Ann Milano, "Ann Milano"
- Contributions:1
Not necessarily but because your credit was probably pulled it may influence your credit score. If it raised your debt but lowered you monthly payments this may also influence your buying ability. The best answer is get preapproved by a good mortgage banker or broker and find out how much house you can afford ;)
- Kathy Werner, "Kathy Werner"
- Contributions:2
Contact your lender for pre-approval. After you have begun the process, do not make any purchases that will affect your credit.
- Jeanne Feenick, "TopNJAgent"
- Contributions:149
It might, the answer will come as others have advised with a review of your credit post purchase. Once you have begun the process of applying for a mortgage do NOT make any big purchases. The bank will rerun your ratios and if there is a negative change it will cause a delay or worse.
- Pacita Dimacali
- Contributions:1254
You said you were "trying to repair" your credit. So it was bad?
What is it now?
And has your income increased recently or is everything status quo -- same income, same expenses?
Other factors come into play when applying for a mortgage --- credit score, debt to income, steady employment, other debt that you're tied to (such as co-signing a loan).
You're best served to ask a lender to prequalify you --- at that time you will know if you can qualify to buy a house, how much you can afford.
Good luck
What is it now?
And has your income increased recently or is everything status quo -- same income, same expenses?
Other factors come into play when applying for a mortgage --- credit score, debt to income, steady employment, other debt that you're tied to (such as co-signing a loan).
You're best served to ask a lender to prequalify you --- at that time you will know if you can qualify to buy a house, how much you can afford.
Good luck
- Janet Ames, CPA, "realtorjanetames"
- Contributions:5
If the payment is the same it will not affect your ratios, but any time you apply for credit it affects your credit score, whether it is for a new credit card, of a purchase of a car or furniture etc. If you have not yet started your process it will not affect the processing of a new application other than those affects. However, if you are already in process or are already under agreement to purchase a house and are past the pre-approval process into the underwriting phase this can cause an underwriting red flag.
There are many things that your credit and your application process. Hopefully, the clean-up that you have done will offset any affect this new purchase will have.
There are many things that your credit and your application process. Hopefully, the clean-up that you have done will offset any affect this new purchase will have.
- Timothy Garrity, "Philly Urban Living"
- Contributions:28
Hi, phoenix98.
To answer your question, buying any big ticket item on credit can affect your score; for better, or for worse.
I you were already pre-qualified for a mortgage with the old car payment in place, and the new car payment is the same, it should not make a difference. Also, car loans are considered installment debt (you keep paying a set amount until the item is paid off). Installment debt is considered good for your credit score.
But ... this could potentially be bad for your Debt-to-Income Ratio if you have not already been pre-qualified for a mortgage. A DTI Ratio is when you take your total monthly payments from your credit report (credit cards, car loans, etc.) and divide the total by your monthly gross income. If your DTI Ratio with an anticipated mortgage payment (plus all of your monthly payments) equals more than 40%, getting a mortgage may be tough. There are instances where you can go over 40%, but there have to be compensating factors (solid job history, high amount of assets, etc.).
Your best bet is to apply for a free pre-qualification and see where you stand. If it's good news, start looking for a home. If it's bad news, you'll know what to work on.
Keep me posted.
TG
To answer your question, buying any big ticket item on credit can affect your score; for better, or for worse.
I you were already pre-qualified for a mortgage with the old car payment in place, and the new car payment is the same, it should not make a difference. Also, car loans are considered installment debt (you keep paying a set amount until the item is paid off). Installment debt is considered good for your credit score.
But ... this could potentially be bad for your Debt-to-Income Ratio if you have not already been pre-qualified for a mortgage. A DTI Ratio is when you take your total monthly payments from your credit report (credit cards, car loans, etc.) and divide the total by your monthly gross income. If your DTI Ratio with an anticipated mortgage payment (plus all of your monthly payments) equals more than 40%, getting a mortgage may be tough. There are instances where you can go over 40%, but there have to be compensating factors (solid job history, high amount of assets, etc.).
Your best bet is to apply for a free pre-qualification and see where you stand. If it's good news, start looking for a home. If it's bad news, you'll know what to work on.
Keep me posted.
TG
- hpvanc
- Contributions:2579
If you are buying well within your means, and purchased the car before you started the mortgage application process it should not effect you beyond the net effect to your DTI and the credit score impact new credit application.
I think when I applied I committed every credit transgression you were supposed to avoid after applying except applying for new credit, since I bought well within my means and had a high credit score I had no issues at closing.
I think when I applied I committed every credit transgression you were supposed to avoid after applying except applying for new credit, since I bought well within my means and had a high credit score I had no issues at closing.
- wetdawgs
- Contributions:26854
Maybe, maybe not. There are a lot of other things very important in the equation. Debt to income ratio is likely to be what is important here. A new car every two years? We use a 15 - 18 year cycle for new cars!
Will recently buying a new car keep me from getting a mortgage?
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