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Why You Shouldn’t Buy a Car Just Before Closing.
If you are in the process of buying a car and are planning to close the deal soon, it is generally not advisable to buy a car just before closing. Here are a few reasons why:
Financing issues: If you are financing your car purchase, the lender will likely require a credit check before the loan is approved. This check could affect your credit score, and if your credit score drops, it could lead to a higher interest rate or even the denial of the loan.
Changing your debt-to-income ratio: If you’re buying a car just before closing on a home, it could change your debt-to-income ratio. This ratio is an important factor that lenders use to determine whether you qualify for a mortgage, and if your debt-to-income ratio is too high, it could prevent you from getting approved for a mortgage.
Delay in closing: If there are any issues with the car purchase or financing, it could cause delays in closing on your home. These delays could cause issues with your mortgage, such as missed deadlines or even the cancellation of your mortgage loan.
Spending too much money: Buying a car just before closing could put a strain on your finances, leaving you with less money to put toward your down payment, closing costs, and other expenses associated with buying a home.
Overall, it is best to wait until after closing on your home to buy a car, as it can help avoid any potential issues and ensure a smooth home buying process.