I am looking forward to buying a house in a few years (likely 3) and have started saving for it. I have enough saved to pay off the remainder of my auto loan, but I am concerned that doing so might have a negative impact on my credit score (which in turn would impact my ability to qualify for mortages in the future). The interest rate of my savings account is almost equal to the interest rate of my car loan. Does it just make more sense to pay over time?
2006-08-20 12:13:52 · 13 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
paying off your debt as fast as possible is always the most sound advice.
all lenders would rather have a debt free client when they loan out hunderds of thousands of dollars-to one who's still paying off cars,credit card bills,etc.
2006-08-20 12:21:15 · answer #1 · answered by NONAME 3 · 1⤊ 0⤋
1
2016-09-26 17:39:30 · answer #2 · answered by ? 3 · 0⤊ 0⤋
There would be no negative impact on credit score from paying off the car loan early. Check with the lender to see if there are any prepayment penalties. If there are none, then pay away. You will decrease the amount of interest you pay over time. Then you have more money available to save for your house. If you do not have an auto loan payment at the time you apply for the mortgage, that will actually be better for you. Lenders compare the total amount of debt you pay monthly with the total income you have monthly as a criterion of rmortgage approval.
2006-08-20 12:25:02 · answer #3 · answered by Freddie 3 · 0⤊ 0⤋
If you have the money to finish paying off your car now, do it!
It will not have a negative impact on your credit. If anything, it could help. Companies are always happy if you pay them earlier then planned. They will never refuse your money.
2006-08-20 12:21:35 · answer #4 · answered by Anonymous · 0⤊ 0⤋
It will help you in the long run if you pay off early cause alot of morgage companys look at it as a early pay of which is a good thing. So do it if anything it will help your credit score:)
2006-08-20 12:44:10 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Paying your car loan ahead of time will certainly have a positive impact on your credit rating...Your rating is based on how you pay your bills and keep them up to date..Mainly making monthly payments on time..
2006-08-20 12:24:37 · answer #6 · answered by forbiddenfruit9 2 · 0⤊ 0⤋
no i would NOT pay it off with you intrest rate in your savings and your car loan the same. what happens if a emergeny happens, then you need money fast and have to use 19 percent apr credit card for it. if you pay on time or double pay recomended would be just fine. save for a downpayment.
2006-08-20 12:51:36 · answer #7 · answered by sarah a 2 · 0⤊ 0⤋
early pay off will not have a negative impact
2006-08-20 12:19:36 · answer #8 · answered by College Student 3 · 0⤊ 0⤋
Pay it off
2006-08-20 12:19:55 · answer #9 · answered by cuteredhead 3 · 0⤊ 0⤋
No,
It will help your credit score
2006-08-20 16:38:59 · answer #10 · answered by Hoa N 6 · 0⤊ 0⤋