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1ST TIME HOME BUYING & CAR BUYING

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Anonymous
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1ST TIME HOME BUYING & CAR BUYING

Hello All,
 
I'd be thrilled if anyone can give me advice regarding timing two major purchases!  Here's the situation....
 
I'm relocating to Cincinnati, OH Oct 1st from NYC. Currently, I'm renting and carless.   So, with this move I want to do 2 things: 1) Buy a house  and 2) buy a car.
 
I have both housing & car covered for 2 mo. which means I'll have to purchase either or both Dec. My FICO score was good at 720 in June.  I just checked it again and discovered it dropped to 635 because of a reporting error!!!!!  I called my cr. cd. co. and they are fixing it and giving me a letter stating it was an error.  They told me my score should improve in a month (Oct).  Anyway, that threw a wrench in my plan becasue I was hoping to qualify for a mortgage Oct. 1st and close on a house in Dec. Now, I'm worried because I'll have to wait until the correction is reflected on my report to get a good mortage. I plan to pay down my obligations so my credit-debt ratio will be 10% by Dec. So, I'm thinking I should wait til Dec. to get a mortgage, but here's the rub...
 
I NEED to get a car in Dec. since I'll be without transportation.  I'm debating on whether to lease or buy. Either way I think it's going to have a credit impact. 
 
So, I wondering what should I do to keep my score as favorable as possible?  Should I apply for the mortgage and then get the car?  Or will buying a car be a big deal?  Any thoughts would be appreciated....


Message Edited by TEENALYNN on 09-05-2008 03:16 PM
Message 1 of 3
2 REPLIES 2
Anonymous
Not applicable

Re: 1ST TIME HOME BUYING & CAR BUYING

I'm not sure if this is going to qualify as advice but...
 
Your credit score will definitely take a hit when you get the mortgage and will probably take a hit when you get the car as well. 
 
Once you start the loan process, if anything on your credit reports change, such as a new car loan, it can throw a wrench into getting the mortgage. 
 
I have heard people say that they are going to apply for credit as soon as they leave closing because the mortgage would not yet be reporting on their reports, so they wouldn't have taken the hit for it, yet.  However, I don't know if it would be possible to do that, or if it's even the right/legal thing to do.  I would guess there's nothing wrong with doing something like that, but don't know. 
 
I do know that you could request a rapid rescore or that the CRA's report the new changes as soon as they've heard from the credit that made the error when they reported to your CR's, but I do think you have to pay for that, and I don't know if you have to have a loan officer request that, or if you can do so yourself. 
 
Lastly, I personally don't understand why people would ever want to lease a car.  You pay for X amount of months, yes it's cheaper, but than at the end you've paid out "X" and you have no car.  At least with a car purchase, whether new or used, you may take a hit on value of the car, but when you're done paying, you own the car and there's no more car payments until you choose to replace the car. 
 
But that's my personal opinion, and the world would be boring if everyone had the same opinions.
Message 2 of 3
DallasLoanGuy
Super Contributor

Re: 1ST TIME HOME BUYING & CAR BUYING

what do you have for down payment?
 
what loan amount?
Retired Lender
Message 3 of 3
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