First-Time Buyer — How Worried Should I Be?
Hi everyone. Sorry for the long read. First-time buyer here, and I’m looking for some perspective because I’m experiencing a lot of anxiety about the final approval process.
For some background, I have a 710 credit score and have maintained perfect payment history across all my accounts. I recently applied with my credit union and was pre-approved for up to $20,000 at 8% for 72 months with $1,000 down. My base gross income is around $40,000/year, before factoring in overtime and commission. Current DTI is ~14%. They told me the final approval is pending submission of the purchase order and vehicle information.
I’ve chosen a 2024 VW Jetta with approximately 43,000 miles, and the vehicle is within the budget I’ve worked out.
I’ve spent a significant amount of time trying to make sure I am being financially responsible about this. I’ve built spreadsheets, calculated my OTD budget, taxes, fees, potential down payment, monthly payments, and LTV, and I’ve gone over these numbers repeatedly because I want to make absolutely sure I’m not putting myself in a situation I can’t afford.
At this point, the amount of time I’ve spent thinking through every possible scenario has honestly contributed to a lot of anxiety about the final approval. I know a preapproval isn’t the same as a final approval, and that’s the part I’m having trouble with mentally. I’ve done everything I can on my end to prepare, but I still don’t know what will happen when I actually submit the vehicle information.
My biggest concern is that I’m a first-time auto buyer. I have established credit and perfect payment history, but I’ve never had an auto loan before.
Realistically, what kind of position am I in? Should I feel reasonably confident going into the dealership with this preapproval, or is there still a significant possibility that the final approval could change substantially?
Thanks!