Sean S asked:
My wife and I are looking to buy a house in the next year and to prepare for that, we want to downgrade our car. With what we want to put down on the new car and wanting to finance only 3k-5k of the car, our bank doesn’t do auto loans for that little, but they will give us a personal loan.
My wife and I are looking to buy a house in the next year and to prepare for that, we want to downgrade our car. With what we want to put down on the new car and wanting to finance only 3k-5k of the car, our bank doesn’t do auto loans for that little, but they will give us a personal loan.
How does a personal(unsecured) loan affect your credit vs a secured (auto loan)?
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Unsecured loans have higher interest rates than secured loans. The higher payment from the unsecured loan will increase the debt to income ratio and possibly result in a higher interest rate.
Should make no difference in regards to score.