Fed raising interest rates, how will this affect me when applying for an auto loan?

[Anonymous]

Hey all, I've got a lengthy scenario but I would very much appreciate any advice...

Here is the background:

I've been looking for a car around ~$30k. I have about $6k on cards and I was hoping to have that paid off by mid January. I may be putting down about $2-3k next paycheck. My equifax has 7 HP's in the last two years (one of them I could probably dispute since I didn't authorize it, but it would be a losing battle since I dont have much evidence), a couple of them are from me moving and getting my credit pulled from renting, and 2 from CC's and 1 from a CLI which is what I could dispute try and dispute but probably lose. My scores are around 711-715 Equifax, and the other two are around 730-740. I've got no baddies or anything, and my only other debt is $45k in student loans but I've never missed a payment or had anything bad from those. I have an income of around $60k and a household income of around $120-125k.

So keeping in mind my debts, scores, HP's, and income I would like someone to advise me on what to do in this situation...

I was planning on applying for the auto loan after my debts are paid off on the credit cards. I have 0% APR on those until mid year 2016. I was just thinking it would look better for an auto loan if I had those paid off, however I do know they take the full picture into account not just what I currently have.

Yesterday I called USAA to get more info and basically I have already been pre-selected for an auto loan for $35k. Does anyone know how likely it is to get a loan after you've already been preselected? I also chatted with the customer service guy there who was super helpful, and he mentioned something about the Fed's raising interest rates this month when they meet, so I did some research and I found this: http://finance.yahoo.com/news/wait-over-fed-almost-certainly-142736515.html
It seems almost certain that the feds will be raising interest rates.

Now on to my question, and again keeping in mind all of the details I've provided on my debts, etc: Should I apply for auto loans BEFORE this meeting with the feds so I can lock in the rates, or should I wait to apply until my debts are paid down? I have 45 days after getting approved to use the auto loan or not so I could still have time to pay down my debts prior to actually getting the car. I'm just wondering if I'll be hurt or have my chances of getting approved be affected by the fact I do have CC debt event though it's for 0% APR.

Does anyone have any advice for me on this situation and what you would do? I plan on applying through PenFed and USAA and possibly any others who will allow a 2005 vehicle. I've heard PenFed tends to be pretty conservative, I'm not sure on USAA but again I've been pre-selected for them. I would also like input on what you think my chances of being approved for an auto loan  for $30k in my current situation are. 

-Thanks in advance!

[jhtrico1850]

First off, I would see what they're offering you now, period. If it's good, take it. If not try again later.

Second, if they do raise rates, it would be at most 0.25%. So a 4% loan MIGHT raise to 4.25%. Bottom lime, don't worry about the Fed. But just see what they can offer you now, or try again later.

[Anonymous]

So what's the consensus on me paying off my credit cards prior to applying for a loan and how that will affect a loan decision?

[bigpoppa09]

it would look good cause u wont be carrying any revolving debt lenders focus on DTI  but if ussa is offering a good rate now by all means take it.

[redbeard]

Paying off the cards is always a good thing.

For the auto loan though, it won't matter. If you are buying a new car, if the manufacturer is offering 0% (and many are), go with that.

The first fed rate increase will likely have almost no affect on car rates (my opinion). Get to the second and then yeah, it might, but as someone said, it will be a quarter of a percent.

Dan

[bldmt]

Hello Shuty. I bought a home in May that has a very long steep driveway so I looked for a second vehicle with 4WD for the winter. I joined Penfed and applied for an auto loan with them and was approved for a 2005 vehicle at 2.49%.