Yes, taking out a business loan can potentially affect your ability to get a mortgage, as it can impact your debt-to-income ratio and your credit score.
When you apply for a mortgage, lenders will typically look at your debt-to-income ratio (DTI) to determine if you are a good candidate for a loan. This ratio measures how much of your monthly income goes toward paying off debts, including credit card balances, car loans, student loans, and other outstanding loans. If you have a high DTI, it may be more difficult to qualify for a mortgage.
Taking out a business loan can increase your DTI, as you will have an additional monthly payment to make. This can make it harder to meet the lender’s DTI requirements.
Additionally, when you apply for a business loan, the lender will likely check your credit score. Multiple credit checks can cause your score to temporarily drop, which can affect your ability to get a mortgage. It’s important to keep in mind that applying for too many loans or credit cards at once can negatively impact your credit score.
In summary, taking out a business loan can affect your ability to get a mortgage, but it’s not a guaranteed disqualifier. The impact will depend on your specific financial situation, including your DTI and credit score. If you are considering taking out a business loan and are also planning to apply for a mortgage, it’s important to carefully consider the potential impact on your finances and creditworthiness.