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Posted in Auto Loans
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Question By
MrLloyd

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Should I purchase 2 cars at the same time or 1 after the other?
I need to purchase 2 used cars. One to replace my existing vehicle that's at end of life and not worth repairing and a car for my daughter. From a credit standpoint, I've been preapproved for more than enough to cover 2 cars of low price but is there any advantage in getting 2 cars at the same time versus getting them a few months apart?

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Yes there is.  Once you have gotten one car, your income to monthly minumums is different, you now have a higher usage/available percentage, and have hard inquiry on your report all bringing down your score.

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I would in your shoes, at same day if I could help it, Just not from same dealerships or same lender. Pre-Approval is only for one car, your scores would drop more from new account/ loan when it report to your credit reports than few inquiries, not to mention dropping your debt to income ratios, dose make it harder to obtain second auto loan in short period of time

Reply by
MrLloyd

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Why not the same dealership or lender?  I was thinking I would probably have better negotiating leverage buying 2 cars from the same dealer.  Please explain.

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Reply by
Nomadre

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MrLloyd.  You would have a greater bargining power for pricing.  But then most likely the lender would know that you are buying two cars, then they would take that into account and be more tough on the requirments to give the loan.

So since we do nto know your credit history, nor the scoring system used by any lender, and the typicall value of the cars you may look at it makes it hard for us to tell you what is best.  If you have very good credit (high 700s to 800s) and a very low income to debt ratio, it will be hard to get approved for two loans at the same time from the same lender.

Due to the reporting lag on loans and credit inquiries, the optimum chance to do this is is different lenders within a day or two at tops.

I am afraid thought that if you can not qulify for the two loans at once on the up and up to a single lender, that maybe you are going to put yourself into financal situation that will be harmful.  If you can get both the loans from the same lender, then by all means negotiate with the same dealership to get the best pricing.

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