This week we are republishing some of our most popular articles in case you missed them the first time around. I believe these articles will be very helpful to you.I am often asked, Is it best to buy a new car before or after I buy my new house? If your goal is to refinance or purchase a home within the next 6-12 months, it’s best to wait until after you close on your home before taking out any additional loans*. New indebtedness will almost always cause your credit scores to drop automatically, even if you are making the payments on time. Furthermore, the new loan may have an effect on the home loan amount for which you can qualify by impacting your debt to income ratio. Simply put, the new loan, whether car or other, could cause you to have to wait a longer time before your credit scores recover enough to qualify for the purchasing/refinancing of your home. Plus, the new loan would likely cause you to qualify for a smaller home loan amount. So if you are considering trading in, refinancing, or buying a car…wait until the day after you close on your home loan to do so.
*Additional loans include: personal loans, auto loans, and other installment loans.
HOPE educates and guides our clients through the maze of credit questions, just like this one, that can effect the outcome of their financial decisions. If you would like to find out more please call us at 704-499-9696. We are waiting on your call!