Car refi or mortgage first?

[CS800]

Current situation:

Car loan about $13000 at 14.7% that I have had since last Nov. Montly payment $335.

Im predicting my scores to be close to 700 by the end of this year. But in mid 2013, I'm hoping to buy a house. If I refi my car in Dec 2011, will that drop my scores?

I'm hoping that when I'm ready to buy a house, my scores will be in the mid to high 700's but want to maximize my score.

So my question is, will refinancing my car to a 3.5% hurt my scores and for how long?

Should I wait until I get my mortgage in 2013 to refi? But since thats about 2 years away, I'm hating the high interest. If I refi my car in Dec 2011 and maintain the same payment, that would cut my term from 4 years to 3 years.

[Anonymous]

When DH & I refinanced his auto loan recently, he took a 16 point hit.

I, on the other hand, had zero FICO hit.

So, it's hard to predict.

You've got plenty of time before your potential mortgage shopping - IMO, I would definitely go for a better interest rate and a faster payoff. .  Your lower interest rate will also affect your DTI which is very helpful at mortgage time as well.  And IMO If you do happen to lose points for a new account, it's extremely likely that you'll rebound long before the mortgage.  But then post auto refi, you may want to keep from any other apps that may impact your score

[CS800]

I was thinking of trying for an AMEX Blue Sky sometimes early next year once my scores pass the 700 mark. You ask why AMEX, it's to get the back dating festure that will raise my AAoA.

The Blue Sky, allows you to pay every month but you dont have to pay in full and you get travel rewards. Not sure what the score requirement is since Im sure they pull EX.

So I was wondering if I could refi my car and App for an AMEX. From what I read, the rule is not to apply for new credit 12 months before a mortgage. I'm looking in the June 2013 timeframe for a mortgage.

[TheZealous]

I would refinance the car if I were you. I bought a car for $15,000 back in January. I recently just closed a new home loan last week with a mid credit score of 668... Good luck to you.

[marty56]

I would also refi the car since you may be able to PIF sooner which will lower your DTI.  Also if the payments go down, your  DTI will go down too.

[Anonymous]

Why wait until Dec to refinance?  If you can do it now, I would - that way it would be almost two years old or even more than 2 years old by the time you are looking to buy a house, much better for the scores....Or even consider paying it off before you buy the house - better cash flow and DTI ratio.

As for AMEX, you can try if you want, but only if you need it - don't apply just because and again, apply sooner so if you ARE turned down, it will be gone before you apply for the mortgage.

[CS800]

Great advice guys, i checked with two credit unions and to get the best rate with them, I need to be in the 680's to get a 3.5% refi. Currently, I will get 6.5%. that's why I was thinking of waiting till december for my scores to go up.

If I get 3.5%, that would save me $80/month that I can just pay towards the car anyway so that would take off about 1 year off my payment and save $4000 in interest.

AMEX is for the back dating to increase my AAoA. Although eventually i would love to get rid of my Cap one with a $59 AF and a $1000 limit.

Waiting to get my EX FICO in July to  see where I stand.