Cars,Credit Ratings, and Mortgages
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Cars,Credit Ratings, and Mortgages
I owe a total of $20K on the current car I bought in early '00. I want to buy a house soon. If I were to sell this car, thereby erasing this debt of my credit report, and then LEASE a new car, is the debt assumed from the lease just as negative a spot as the debt i am assuming now? Or is it better because you can walk away anytime? Or is debt debt no matter how you look at it?
(The answer is just one part in helping me make the decision on whether to sell my car - a 1998 M3 with maintenance costs I must incur, vs leasing a brand new car (Audi 1.8TQ Avant) with similar payments ($460/mo) with NO maintenace costs. Yet then i cant own it.)
(The answer is just one part in helping me make the decision on whether to sell my car - a 1998 M3 with maintenance costs I must incur, vs leasing a brand new car (Audi 1.8TQ Avant) with similar payments ($460/mo) with NO maintenace costs. Yet then i cant own it.)
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Re: Cars,Credit Ratings, and Mortgages
I'm afraid that will make no difference. Credit ratings are built upon monthly income vs. obligations. The lease is every bit as much an obligation as the purchase is. If you think you can "walk away anytime," you are headed for a very low Impirica score. HTH
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NOT TRUE.
Your Debt To Income ratio is calculated based on the real amounts you owe. If you lease the car but DON'T own it and there's not a true balance on the loan then it will not be used to calculate your DTI which is one of the big three most important ratios for this type of thing. HOWEVER, there's the issue of how you lease the vehicle. If I were you I would find a way to claim the vehicle as a business expense. Do you drive a lot for work? Are you self employed?
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Do AFS leases show on credit report?
It's been mentioned by a few people on this board the leases through AFS often do not show up on your credit report.
I'm currently leasing a A4 and will be looking for a mortgage in the next few months. I'm very interested to see if the lease will show up, planning on pulling my credit reports before applying.
I'm currently leasing a A4 and will be looking for a mortgage in the next few months. I'm very interested to see if the lease will show up, planning on pulling my credit reports before applying.
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I'm a mortgage broker. There's a list of things you should check off first:
- Have 2yrs consistent employment history (not necessarily with the same employer)
- Documentable income is best!
- 2yrs residence history
- W2 and/or 1099's
- bla bla bla...more to come...
- Documentable income is best!
- 2yrs residence history
- W2 and/or 1099's
- bla bla bla...more to come...
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