 TITLE: Can You Use a Personal Loan as a Down Payment? CONTENT: How Will Getting a Personal Loan Affect My Credit?\n--------------------------------------------------\nTaking out a personal loan prior to applying for a mortgage, even if you don't plan to use it for a down payment, can affect your credit in both positive and negative ways. Since the account will show up on your credit report, making on-time payments every month can help your credit score (while making late payments will hurt it). If you use a personal loan to consolidate revolving credit card debt, you'll reduce your credit utilization ratio, one of the most important credit scoring factors—and, in turn, likely improve your credit score.\nIn general, it's wise to hold off on applying for new loans and credit during the mortgage application process. Doing so will result in a temporary dip in your credit score since it triggers a hard credit inquiry. It's also adding to your debt load, which could work against you when applying for a mortgage. You want your credit to be in the best shape possible when you apply, so this is an important factor to consider. Here are some other action items that can help strengthen your credit before approaching mortgage lenders:\n*   Check your credit report and credit score to know where you stand and dispute any inaccurate information.\n*   Pay down credit card debt.\n*   Continue making timely payments on all your accounts.\n*   Consider getting preapproved for a mortgage so you know how much house you can afford. END