Buying A Home
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Should we get a new car before starting mortgage stuff?

DH and I have started looking at getting a new house. We have yet to get a preapproval or even look at mortgages. DH's car is acting up and we are thinking about getting a new (used) car for him. I know I have read it is a better idea to not get a new car before your mortgage closes, but will it really affect us that much if we have not even started that process yet?
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Re: Should we get a new car before starting mortgage stuff?

  • My understanding is that you would need about a 2 payment cycle on paying on the car before getting pre-approved and buying a home but I could be wrong.
  • I read somewhere... as advice they say to get a car before you start the home buying process.  This way you know that you can most definitely incur the mortgage payment you are about to have.  You will already have the car payment set up and you can easily configure your budget.  However if you've already started your pre approval/approval process for your mortgage I would check with your lender before making any larger purchases.
    NewbieNestie
  • If you have plenty of money for a down payment and enough income each month to cover a mortgage, I don't see why it would effect you getting a mortgage, but there are a lot of factors that play into getting one.
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  • If your debt to income ratio is okay with the car, go for it - if it would put your DTI near the max (most cases lenders want less than 20-25% not including mortgage payments) then wait until after you close on a home (auto loans are a little more lax, afaik).
    AnniversaryBuying A Home
  • I financed a new car but i made sure exactly a year had passed before I started looking for a home, but if you are buying the car cash I dont see where it would be a problem at all
    Anniversary
  • We bought a car right around the time we started looking (no choice, DH's car was totalled).  It wasn't a problem for us but then again, by the time we actually went under contract, it had been almost 6 months.  As long as you can explain any large deposits to or withdrawls from your accounts within that last 2-3 months before you go under contract, you'll be fine. 

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