Planning to buy home and new car?

[Anonymous]

I am going under contract for a home- new construction this weekend. The home will be ready in February 2016. I am currently in pre-approval process, waiting on letter from loan officer today. I was in a car accident about 3 weeks ago, recieved news that my car would be a total loss. I need a vehicle to get to and from work so not geting one is not an option. The loan officer stated it is ok to get a new loan and more inquiries however I am a bit concerned. Should I be worried? How will this affect the closing process considering my credit score may be lower and I have added a new debt.

RIght now, my middle mortgage score is 655, debt to income ratio is 11%. I am applying for a VA loan.

Thanks

[Anne1208]

Is it possible to just get a cheap car to hold you over for a measly few months? I mean, this is the single most important time to be cognizant of your credit so why risk it?  My car just crapped out last weekend (transmission blew and we just found out right before that that it needed like another $3500 in repairs, too). We sold it for $2000 and used that to buy a friends older Altima. We won't get preapproved until April next and would be able to close on new construction around December.  In that period of time we will travel long distance about three times, for which we will just rent a car. 

If you've only got a few short months, why risk it?  There are plenty of super cheap but decently reliable cars to get you through a few months, and when you've closed, you can get your keys in hand, let them fund your loan, and then go the next day to get a new car, and even get most of your money back on the cheap car esp if you sell it yourself rather than a trade-in. 

[mynameainttracy]

As long as your monthly payment is close to your last one and your DTI doesn't move much I would get a car.

[Anonymous]

HI

thanks for responding and this was my initial thoughts since my credit score is border line but my LO is telling me otherwise. It will be such a hassle to purchase cash car for time being and I want to know if risk is low or high.

[DallasLoanGuy]

the risk is low

if the file somehow stops approving thru automated underwriting, then a manual underwrite would likely still go

[Anonymous]

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@mynameainttracy wrote:

As long as your monthly payment is close to your last one and your DTI doesn't move much I would get a car.

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Thanks for this, yes this is what I was informed but just needed confirmation

[Anonymous]

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@DallasLoanGuy wrote:

the risk is low

if the file somehow stops approving thru automated underwriting, then a manual underwrite would likely still go

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thanks!

[edcampbell613]

Best to call your LO and ask him how your ratios look. If you are at the high point (40's) you need to keep the payment the same or lower of your old car. If you are much lower than you have room. But you need to chat with the LO 1st.