Anyone ever buy a CAR shortly prior to a HOUSE?

Hey all!

Hoping for some experience here...

Looking at a pretty screaming deal for a 2019 GTI Rabbit edition. You all know the fever you can get for a new car. :wub:

However, in about 6-8 months my fiance and I will be married and looking to get into a house. We project that we will have enough for a downpayment on the house - at least for an FHA loan, which has its pros and cons, of course.

I am also projecting that all my expenses, INCLUDING this new car, will be less than 25% of my minimum income. Week to week checks i ALWAYS work overtime and make a good chunk more, so really all in all my car payment and other expenses would be like 15-20% of my monthly income.

The big concern is, I've heard for years that creditors become quite picky about those who have 'fresh' loans and leases. Like they expect you to have zero current financial obligations short of the house you are pursuing. Kind of a nightmare.

Other random facts, I have a good credit history (and car credit history) no late payments ever, blablabla, i think my debt to income ratio is currently good and will be better by the time I am trying to get a house - which wifey will be putting her name on, too. We make OK money, maybe middle class or so? Not looking for a super expensive house, but around here, 250k is the minimum for something worth the investment to me.

Currently my cheap MK6 (and insurance, if creditors look at that??) costs around 300 a month. New car with insurance, around 500 a month. So not a HUGE jump, but I'd owe damn near 20k more than I currently do. What matters more, MONTHLY obligations, or TOTAL debt? Both??

In short, for those who DID buy a car or had a current loan of a somewhat higher # while house hunting, what was your experience? Idk, seems to me like anyone can get a house; people with student loans working at the dump somehow manage, even while having kids, but I dont like taking huge risks. Just really don't want to miss out on my one chance for a new, urano gray rabbit... :iono:

thanks for any insight!

I almost did but was glad I didn't. A long as your debt to income ratio is good it should not be a problem. That extra 200 a month could be put toward the "perfect house" that comes in 10k over your budget. A house is one of the biggest investments and imo one of the most important ones. Any extra money that could go toward the perfect one for your new wife is money well spent. Just my experience

Just don't. Priorities are key here. Houser first play toy last. And yes they do not want any surprises or issues when doing the loan.

Debt to income ratio is normally the most common thing that lenders are concerned about. They may ask what that credit pull was for and as long as it is a normal/justifiable credit they don’t really care about it.

But like others have said, don’t buy the new car now if the plan is to really buy a home in 6-9 months. Having bought two homes, there’s ALWAYS unexpected expenses associated with moving and buying a house. Yes it’s ONLY 200 extra per month, but it’s almost double your current payment.

I’d hold off on buying the car, plus I would never buy a new car to begin with #financialsuicide but that’s just me. I’d rather buy a used car that’s maybe a year old with all the warranties etc for significantly less.


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Thanks mk6racing. My wife talked me out of it. House first...

This car is stickered over 30k but selling for 25k so it's just a damn steal!! Used SE with performance package at 40k miles are going for like 23 or more around here so it's a huge HMMM moment

GolNat said:

I almost did but was glad I didn't. A long as your debt to income ratio is good it should not be a problem. That extra 200 a month could be put toward the "perfect house" that comes in 10k over your budget. A house is one of the biggest investments and imo one of the most important ones. Any extra money that could go toward the perfect one for your new wife is money well spent. Just my experience

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Very well said GolNat. That shiny new car is a depreciating asset. Your house is not, buy a good one in a good area & enjoy the MK6. :thumbsup:

I think as long as your debt to income ratio, as well as your credit is good, you should be fine. My wife and I bought our house while we had a car payment on an Audi A3 with zero issues. About a year after we bought our house, I financed my GTI with no issues either. I was still able to qualify for 0% financing with my credit score of 840.

That being said, I still agree with others, that if you don't need the car, don't do it. Focus on the house 1st and although you say your projected expenses are within 25% of your income, having a house comes with a lot of unexpected expense. You are better off saving the money on the new car for any home improvement/maintenance, unexpected repairs, home insurance, property tax, etc.

if your current gti works fine and you dont NEED a new car then dont do it.

I agree with all the naysayers above, don't do it. Creditors do look at debt to income ratio but ones' FICO score is a biggie and that will drop for a while after you buy something. A house should always come first; it will also be an investment for you, a car is always going to depreciate. Like MK6Racing said, get something a year old or so, avoid the high prices.

Yep saving new car for later. I must stress though VW is GIVING gtis away right now, for like as much as used ones go for, it's like buying them at a depreciated value off the lot!

riceburner said:

Yep saving new car for later. I must stress though VW is GIVING gtis away right now, for like as much as used ones go for, it's like buying them at a depreciated value off the lot!

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Agreed. A urano grey rabbit is super tempting at what they’re going for, but I just can’t get down with the plaid seats

This thread showed up just in time!

My 2014 Mk6 is nearly paid off. Owe less than 2k on it. Approaching 50k miles. I've been sooo tempting to upgrade at times to like, a Mk8 when they are about to be on sale, but I'm nearing the time where I'm thinking of buying a house now. I'm probably very similar to the OP regarding debit/income ratios and feel like once this car is off my back (my only significant debt), I'll be clear sailing for a nice house loan.

I didn't even think about if I took the itch and went with a new car loan for a few years, how significant that could impact my house loan.

These types of threads are great when the timing is just right

sniper27 said:

I think as long as your debt to income ratio, as well as your credit is good, you should be fine. My wife and I bought our house while we had a car payment on an Audi A3 with zero issues. About a year after we bought our house, I financed my GTI with no issues either. I was still able to qualify for 0% financing with my credit score of 840.

That being said, I still agree with others, that if you don't need the car, don't do it. Focus on the house 1st and although you say your projected expenses are within 25% of your income, having a house comes with a lot of unexpected expense. You are better off saving the money on the new car for any home improvement/maintenance, unexpected repairs, home insurance, property tax, etc.

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This. If the credit score and debt to income are ok it shouldnt be a big deal. I want the rabbit edition so bad too but I cant justify pulling the triger on one. I purchased a house last year and I made it a point to pay off my GTI before the closing. I have really good credit but the house needs some work and I just wanted my money to go towards the house without another annoying payment.

As far as lenders go I'm sure you'd be fine; esp if you have a good/long credit history. My personal advice though, get the house and get finances re-settled before getting the car. Esp if you don't have any upper limit on the house in mind (250k being the lower limit). With a big commitment like a house you very well may end up letting your upper limit creep up a bit higher for that perfect place if/when you see it and you don't need the financial burden of another 50 months worth of car payments looming.

The house will rock your finances in more way than one, and unless you're just rolling in the $$$ you'll stress and have to adjust to the new expenses. After you settle out again you can see how/where the car payment will fit in.

FWIW; my mortgage is roughly 30% of my take home pay (after 401k, taxes, benefits, etc.) with no car payment and I sure can't imagine tacking on another $400 per month comfortably!

Lastly... Don't know if kids are in the picture. But newlyweds with a new house... that's the logical next step. And kids are deff more expensive than a car!

We just purchased a new Honda Odyssey last fall and are now looking for a new home. Assuming good credit the loan officer told me that they like to see the debt to income ratio at no more than 45%, which is a lot. If your debt to income ratio with a car and a mortgage will be under 30%, that’s pretty good.