I fix cars for a living. I do not write mortgages. Dakotah does, and she put it better than I can in a video 269,700 people have watched. "The truck payment isn't helping my guy." On screen, she's looking at a borrower who wants a 500k mortgage on a 75k salary with a $1,000 truck payment.
I see the other half of that story in driveways. Somebody has a truck with a noise, a light on the dash and a fear of what it will cost. So they trade it in, sign for a new one, and then go apply for a house. Here's what that does, and what I'd do first.
The Math Your Lender Runs
Your debt to income ratio is all your monthly debt payments divided by your gross monthly income. That's the CFPB's definition, and a truck payment sits right in that top number.
The ceiling is real. On a manually underwritten loan, Fannie Mae's maximum is 36%, up to 45% with the right credit and reserves, and 50% through its automated system. Other programs and lenders set their own limits.
Now use Dakotah's own rough math from her concessions video, where $10,000 of price moves a payment about $50 a month. Run that backward and a $700 truck payment takes up the same monthly room as about $140,000 of house. Rates move that number, so have her run yours. Six figures of buying power, gone for a truck that was maybe fixable.
What the Repair Really Costs
I pulled 2,632 real jobs from our shops for Data for Trades. Here's the median customers paid, next to one month of that example payment.
A brake job is less than half of one payment. A diagnostic costs less than a week of it. Nobody should sign a five or six year note because of a light they never paid $150 to have read.
Some trucks really are done. Rust through the frame, a blown engine on a high mileage rig, a repair bigger than the truck is worth. I'll tell you that straight. But you want to hear it from someone with their hands on it, not from the guy selling you the next one.
The Order I Would Do This In
- Pay for the diagnostic first. Find out what's actually wrong and what it costs.
- Call your lender before you sign anything. Dakotah can tell you what a new payment would do to your numbers while it's still a question.
- Keep repair money apart from your closing money, and ask your lender before you move either one.
- If you still have to replace it, get the replacement inspected first. We booked 340 pre-purchase inspections in that file, and only 26% got done, mostly because the car sold first. Move fast, but look under it.
A truck gets you to work. A house is the thing you're trying to build. Get the order right and you may end up with both.
Anthony Limpert co-founded Supercanic with Alaina Limpert and works as its lead technician. He writes on auto repair, used cars and what shop numbers really say.