"zkat" wrote in message
...
I'm trying to work out whether taking out a loan (3k-5k) to buy a car
a month or two ahead of applying for a mortgage is a bad idea.

Other things being equal, how will a lender treat an outstanding
(unsecured) loan? Will they reduce the loan amount? Will they ignore
it?

Generally, taking out a loan can be beneficial to your credit rating
provided you make sure you don't miss any payments. It shows that you behave
yourself when lent to, and lenders like this. However, a couple of months
does not give you much of a track record - unless you've had loans before.

It will also depend on the size of the loan compared to your earnings, and
whether you've got any other loans as well - credit cards, for example.

I doubt if your new loan will make much difference to the lender's thinking,
but then all has changed over the last few months, so who knows?

Rob Graham