Buying first home, and new car

Forum|Forum|7 years ago
February 5, 2019
1 reply
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I will be purchasing my first home with a VA loan within the next 6 months, but also planning on buying a new vehicle at that same point as well.

Am I better off financing the vehicle first then start the VA loan process, or wait until the loan process is done then finance the vehicle? I understand I shouldn't start any new credit line while in the loan process

NCPERSON1

it depends on how much other debt you have and your credit rating.

The bank is going to look at how much you have in monthly debt obligations. A Car loan will add to that, but if it doesn't take the total over the VA guidelines, it MAY not matter.

best to ask a credit counselor at your bank / credit union for advise on this one.

InvestedInMyFinances

Employee

It definitely depends on your credit. Both of the new loans will count as a hard inquiry on your score, which will cause it to dip for a few months. If your score is near the limit of what your mortgage lender requires, you may want to purchase the home first.

Talk to your lender before doing anything so she can run some numbers for you. IMO, you should finalize the home loan first. A better Credit Score will get you a better interest rate, which means more savings over 15-30 years. It’s easier to deal with a slightly higher rate on a loan that is lower in principle and shorter.