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Paying off 2 loans (both car payments) and saving for down payment on house over the next 1 1/2 years before we go to buy a house. I can have those 2 loans paid off completely in 6 months or so, but wasn’t sure if it were better for our credit if I spread them out over the next year to year and a half to help out our credit even more. Not even certain if it will help it out or not I just know paying them off too quickly can be a bad thing. Interest rates are both quite small so I’m not worried about that, and more so thinking bigger picture. We’re also military and I feel confident will get a good interest rate on our mortgage through the VA program. I have an excellent credit score and my husband has a good score. Just one credit card in my name. Also should we go ahead now and get him a credit card so he can be helping out his score some that way too? I always pay the total down every month so I don’t get charges.

2 Thoughts on Should I pay off all my loans quickly or take my time?
  1. Reply
    Silly Goose
    February 13, 2014 at 2:31 am

    It would be to your benefit to show that you have no loans when you buy a home.
    You would qualify for more home.
    6 months worth of payments on a loan is all you need to develop credit.
    A paid off car loan will report positively for up to 10 years on your credit reports.
    Add hubby to the card you currently have. Easiest way.
    He doesn’t have to use it. You can cut it up when it comes in the mail if you want.

    If you buy a home, make sure you will not move for 5 to 7 years.
    Closing costs are a monster.
    I see too many people buying homes and moving 2 years later.
    In this case, it is better to rent.
    The military has a way of moving people around. Remember that.

  2. Reply
    Drew H
    February 13, 2014 at 2:39 am

    One of the big things mortgage lenders look at is your debt to income ratio. They want to know you can pay your mortgage each month. So it would be a good idea to have all of your loans paid off by the time you start mortgage shopping.

    However you want to work it, just have the debt paid off before you look for a house.

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