I am trying to cut down on household finances, and I know from a previous personal loan application that banks think I enough credit extended to me already, but if I want to get a new auto loan to reduce household finances (get a cheaper car, lower payment), what is the possibility of that going through? Wouldn’t that lower my DTI?
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{ 2 comments… read them below or add one }
Why do you want a new car loan? If you have a payment that killing you, sell the car! Get a less expensive car that you can pay cash for. If you eliminate the car payment, you can use that money to attack the rest of the debt it sounds like you have.
I am almost debt free now after a lot of hard work and it is SO worth it. I highly recommend Dave Ramsey’s book, "The Total Money Makeover". It changed my family’s life.
Check out his website below…lots of free info!
you know DTI stands for debt to income ratio, right? it means your debt is way too much for your income. the higher the ratio, the less likely a loan would be extended to you. so if you have a high enough DTI as is, why would you want to further increase it by taking out a new car loan? if you want to lower your DTI, then you need to get rid of some of the debts or generate a higher income.