I am planning to go under contract on new construction in the fall which would give me enough time to pay off my auto loan as well as save up for the $5k earnest deposit and begin saving for the downpayment. I have emailed the lender that I have been working with to make sure everything will be in order when I'm ready for preapproval and have asked for their DTI limits for FHA (waiting to hear back). My question is... I owe 12k on my car that I had planned to pay off by October. If having this car payment (I also have 2 smaller student loan payments and a installment agreement w/ the IRS) doesn't put me over the max DTI ratio that the lender provides would it be best to still pay off the car or should I put that money aside into savings to show more cash in the bank?
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