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    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #1

    Jun 27, 2007, 07:00 AM
    Should I buy a car first or a house
    Dear everyone,

    I have a question:

    Once I have saved some money, should I buy real estate first or buy a new car(the old one is paid for)?

    Why is that?
    alkalineangel's Avatar
    alkalineangel Posts: 2,391, Reputation: 323
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    #2

    Jun 27, 2007, 07:01 AM
    Simply, a house will build you wealth. A car will depreciate the minute you drive it off the lot. If you can afford a house, it is a much better investment. Buying a new car, especially is one of the worst investments you can make.
    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #3

    Jun 27, 2007, 10:30 AM
    How much down payment do I need for the first house?

    Thanks Alkalineangel:)
    Emland's Avatar
    Emland Posts: 2,468, Reputation: 496
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    #4

    Jun 27, 2007, 10:44 AM
    Depends on your lender and your credit. I wouldn't get any credit cards, though, if you are considering purchasing a house.
    alkalineangel's Avatar
    alkalineangel Posts: 2,391, Reputation: 323
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    #5

    Jun 27, 2007, 10:51 AM
    She is right. 20% is recommended, but that is terribly difficult if it is your first home. But remember that you will have to pay PMI if you are below 20% on a down payment. That is a sort of insurance you have to pay to ensure you will pay your mortgage... seeing as you don't have a lot of equity in the home yet. I would aim for 10-20% if you could. But there are other plans like a FHA loan that only require 3-5% down. Some offer o% down, but be leary of those. Make sure you do your research, there are a lot of bad loans out there now...
    Emland's Avatar
    Emland Posts: 2,468, Reputation: 496
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    #6

    Jun 27, 2007, 10:56 AM
    You could join the Armed Forces. Then you would be eligible for a VA loan which doesn't require anything down. Just a thought!
    alkalineangel's Avatar
    alkalineangel Posts: 2,391, Reputation: 323
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    #7

    Jun 27, 2007, 11:13 AM
    They also give a decent sign on bonus... you could put that in savings.. lol...
    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #8

    Jun 27, 2007, 11:18 AM
    Lol, I'd like to marry an officer ;) thank you ladies!
    alkalineangel's Avatar
    alkalineangel Posts: 2,391, Reputation: 323
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    #9

    Jun 27, 2007, 11:21 AM
    Hehe... smart girl. Not a problem good luck.
    Emland's Avatar
    Emland Posts: 2,468, Reputation: 496
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    #10

    Jun 27, 2007, 11:22 AM
    I know a couple of single ones, but they are way too old for you!
    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #11

    Jun 27, 2007, 11:33 AM
    ^.^ lol, thank you... how old are they? ;)
    Fr_Chuck's Avatar
    Fr_Chuck Posts: 81,301, Reputation: 7692
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    #12

    Jun 27, 2007, 01:09 PM
    Well no one should buy a "new" car, a very nice one year old car perhaps a fleet car is always the best deal, On a new car you loose several thousand dollars the first 10 minutes you drive it off the lot.
    Dr D's Avatar
    Dr D Posts: 698, Reputation: 127
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    #13

    Jun 27, 2007, 01:36 PM
    Too manty people nowday have the attitue that "you can always sleep in your car, but you can't drive your house." Seriously, if you have plans to buy a home in the near future DON'T buy a car, or anything else with a big payment, as that could mess up your Debt To Income Ratio, causing you to not qualify for a mortgage. In the past I have seen borrowers celebrate the acceptance of their offer to purchase a new home by buying a car to put in their new garage, only to wind up with no house.
    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #14

    Jun 27, 2007, 01:53 PM
    Quote Originally Posted by Dr D
    as that could mess up your Debt To Income Ratio, causing you to not qualify for a mortgage. In the past I have seen borrowers celebrate the acceptance of their offer to purchase a new home by buying a car to put in their new garage, only to wind up with no house.
    Excellent! Debt to income ratio is what I have concerned too! Thanks
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