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TodayTime8321 t1_ivr6pfg wrote

Reply to comment by THROWAWAYHELLLLL in One Day I want To have a Home Here. Seems like wishful thinking. by THROWAWAYHELLLLL

Your credit score will take a hit when the car loan is fully paid off. It will bounce back but you will still take a hit. I recommend trying to plan a home purchase while you still have that loan on your report when it is mostly paid off but still active. Like when there is still $2500 or so left. Not a huge amount of debt but the payment history will keep your score high.

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THROWAWAYHELLLLL OP t1_ivr85yj wrote

Oooo ok, I did hear about the credit hit but I assumed it would fall off rather quickly. So stupid that paying off your loan makes you look worse. I will keep that in mind. Hopefully I'll be at that rate in a few years. I have savings, and with that in mind, I could pay it down to that amount, and have enough to put towards a down payment. That actually shortens my potential wait time by a bit! Thank you!

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ForestGuy29 t1_ivt66q1 wrote

Depends. The car loan will count against his debt to income ratio, a major factor in the amount the bank will lend to you.

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TodayTime8321 t1_ivtrpnv wrote

If the amount is low and there is no other debt it will be fine. Having that credit history on her report will help her with a mortgage.

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