Will a new car note negatively affect a mortgage application?

I heard that when applying for mortgages, lenders don't like to see recent big ticket items on your credit, like car notes. Is this true?Will a new car note negatively affect a mortgage application?
Yes. If you must purchase a new car, put it off until after you have signed your mortgage and purchased the house--- not just the preapproval process. If you need the car now, then you may consider waiting a bit before buying the home. Any new debt--- even a credit card that you never actually purchase anything with--- causes your credit to go down a bit; it comes back up with a couple of months of regular payment history but that 20 point difference can make a huge impact on your mortgage terms. Also many big purchases in a short time will make your credit look like you may be on your way to overextended. Lenders, especially mortgage lenders, like to see a history of carrying that amount of debt and when the size of the debt changes dramatically, you no longer have any history of being able to pay.Will a new car note negatively affect a mortgage application?
It all depends on many different things.


Your net income minus expenses, how much you already owe to other accounts, amount of late payments on other accounts, etc.


You can have big ticket items so long as you can afford them.


Talk with your bank, lender or mortgage company.


They'll be happy to help see if you can afford more debt.


That's why they are there.


Good Luck with the new house!
If you just bought a car on credit you will have regular payments for the car. That amount of money cannot be used for your regular mortgage payments. So yes, lenders will factor such things into their offer of credit. Most probably it will reduce the maximum amount you can get.
Yes. If we see a inquiry for car financing, the bank wants to know what the conditions are for the loan, since that has to be now factored into your debt ratio. If you decided not to purchase the vehicle, then they want to see a letter of explanation on the inquiries. Banks are crazy about that...
If you have no other types of debt, then a car note shouldn't be a red flag. But, if you have alot of other debt )ie. credit card, student load, etc.) and have a recent car note, then you may be penalized through a higher interest rate with a mortgage.

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