The Tisha Shaw Team

Taylor Made Financial

  • Home
  • About
  • Resources
    • First Time Buyer Tips
    • First Time Seller Tips
    • Closing Costs
    • Home Appraisal
    • Home Inspection
    • Loan Checklist
    • Loan Programs
    • Loan Process
    • Mortgage FAQ
    • Mortgage Glossary
  • Apply
    • Download 1003 Application
    • Short Form Application
    • Get a Rate Quote
  • Blog
  • Reviews
  • Get in Touch

Buying A New Car Impacts The Ability To Buy A New Home

September 16, 2020 by Tisha Shaw

Buying A New Car Impacts The Ability To Buy A New HomeThose who are in the process of buying a new home need to be aware of some of the factors that might influence their ability to do so. Even though credit score, income, and assets will play major roles in whether or not someone might be approved for a loan, there are other factors that will play a role as well.

Buying a new car might even have an impact on the homebuying process.

Why is this the case?

The Debt Payments On The Car Will Play A Role

There are multiple ways to buy a car. Some people elect to pay cash for the entire vehicle. While this is a challenge for most families, this will prevent any new debt from being added to the family’s finances. At the same time, this could also reduce the amount of cash the family has on hand to put toward the new home.

Most families end up putting a down payment on a car and taking out a loan for the rest. While this is a financially responsible decision, this can also make it harder to purchase a new home. This is because the payments on the car are going to be added to the family’s existing debt. A potential lender is going to see these debt payments and reduce the amount of money they are willing to provide. This could make it hard for a family to purchase their dream home.

Factor In The Cost Of The Car

Those who need a new car need to factor the monthly cost of the car into the home buying equation. For example, if the monthly payments on the car are going to be $200, then this is $200 less that the family can afford for the mortgage payment. The same math has to be done by removing the down payment for the car from the potential down payment on the house.

Do The Math Carefully

People need cars to get around in most parts of the country. At the same time, the financially responsible decision is to take the cost of the car and deduct this from the assets that are available to pay for the home to avoid any surprises. The lender is going to do the same thing.

Filed Under: Mortgage Tagged With: Debts, Mortgage, New Car

Tisha Shaw

The Tisha Shaw Team


Loan Officer, Mortgage Banker
Taylor Financial Group

Office: (415) 246-6966
Fax: (415) 254-2252
info@taylormadefinancial.net

NMLS #338288 • DRE #01292127
Tisha Shaw
Get a Rate Quote →

How can I help?


0 / 180

Connect with us!

Browse articles by category

Quick Links

  • California Consumer Privacy Act
  • Privacy Policy
  • Contact Tisha
  • Blog
Tisha Shaw NMLS #338288, DRE #01292127

Equal Housing Lender

Our Location


851 Irwin Street, Ste. 201
San Rafael, CA 94901

Copyright © 2023 · Powered by MySMARTblog

Copyright © 2023 · Genesis Sample Theme on Genesis Framework · WordPress · Log in