change in credit score

[bluehealth]

Hi,

My FICO is now at 663 - I am interested in buying a  home soon, within the next year, but also need to get another car.  I'm concerned about what the impact of buying a new car (adding a new loan of about $10,000) will have on my FICO and consequently having an affect on purchasing a home. What should I do - try to nurse the old car until I am able to buy the home (it's an old car with 160,000 miles on it, 20 MPG - I drive about 25,000 miles/year), or get a newer car that's more dependable with around 35 MPG?  Thanks for your help.

Thanks for your help.

[Anonymous]

From what I've read here, mortgage lenders don't like to see "new" auto loans. Conversely, auto loan lenders LIKE to see mortgages.

Again, that's what I've read ... us, we've got a '99 Sable that's at death's door and we're waiting to buy a house before we get a new car.

As usual, though, someone else might have a completely different opinion and the experience to back it up.

[Anonymous]

Do you have an open installment loan on your report already? If you don't then adding an auto loan might help your score. I would still wait 6 months to apply for a mortgage though so the new credit won't scare off lenders. You want to make sure the car payment won't wreck your DTI (debt to income) ratio though - so can get approved for a loan.

If you already have an open installment loan I recommend you tough it out until you get the house because the new account will only hurt your score in the short run.

[marty56]

I just got a new car back in June and I had an older auto loan still open.  The old loan was paid off and the new loan did not lower my TU and EQ score.  EX went down 17 points if that helps you.