Need advise payoff question?

[thorice]

I plan on buying a home in 10 months. I owe 13,000 on my car. When I pay all of my monthly bills I have $1500 remaining. Do anyone think it would be a good idea to save this money or payoff car first and have more money for a better mortgage amount. Thanks for any and all advice.

[Anonymous]

I would say you're better off saving money for a larger downpayment.  Definitely make more than the mimimum payment on your car loan, but you're better off setting aside money to ensure a better mortgage rate, assuming you have a pretty good rate for your car loan.

[thorice]

Thanks.

[Anonymous]

I'd definitely build your savings rather than paying off an installment debt.

Surprisingly enough, paying off an installment acct. can actually cause your scores to drop.

Mine did when I paid of 2 car notes.

Creditor's like to see a mix of credit instruments: cc's, installment notes, mortgages, etc. If you look at the pie chart under "Credit Education" at the top, you can see where credit mix, accounts for 10% for your FICO score.