<prompt> Human: My husband and I wanted to buy a house. Sadly, after our lender elaborated on the financial scrutiny and numerous qualification percentages for even a 3.5 down FHA loan, we realized we couldnt buy a house in our present situation. Dreams crushed. So we started working out a solution. He got a new job, making 15k more than his previous job. But the real increase was in the benefits, which included a company car: free car, free maintenance, only 25 a week payroll deduction for unlimited personal mileage, and ALL gas goes on the company AmEx. But--there was one serious downside. He drives a Ford Fusion. It is VERY underwater due to his past divorce. CarMax offered us 7k. He owes 14k. No one wanted it on Craigslist or in the paper to help close the payoff gap with a private sale. We had 7k in savings but that was for the house...Which left my car. A 2014 Jeep Grand Cherokee. My baby. The first car I bought myself. My pride and joy because Im one of those people who does NOT view their car as an appliance cue PF judgement. CarMax offered us 19k and I owe 21k. So we sold it. We paid the 2k difference up front. I now drive the Fusion and we put an extra 150 on the payment toward principal each month to get us a little less underwater.But the SAVINGS are magical: 375 a month no more Jeep payment 140 a month no more Jeep insurance, Im a driver on husbands cheap USAA insurance 100 a month gas for his company car is paid for For a total monthly savings of 615. Offset 150 for extra Fusion payment, is still an extra 465 a month. Not to mention our Debt-to-Income ratio fell 9 getting rid of the Jeep, which made our loan officer really happy. Between his extra post-tax income of 900 a month, and the savings of 465, we went from barely saving 250 a month three months ago, to saving over 1500 a month now.Well have more than a meager 3.5 to put down on a house next year. Well have money after the house purchase if shit goes wrong which Ive heard it definitely does. Well have an emergency fund. Am I sad about the Jeep? Yes. Was it worth it? Yes. Will I mind parking the Fusion in our new driveway? Not at all. Tl;dr Sold the new car I loved, have to drive husbands older car so we can buy a house next year. Savings was totally worth it and have no regrets. PF is right, just drive an older car and sock away your money. Edit: Im on mobile. Im sorry about formatting. I think I fixed it? Edit 2: Went to dinner, came home to too many comments to respond to. Moral of the story: First world problem? Yes. Are we the most frugal, financially responsible people ever? No. But were making progress. Edit 3: Came back this morning and wasnt expecting so many rude, judgmental, and offensive comments. Aside from those people, thank you to those who were actually supportive, who offered a constructive scolding, and shared their own similar experiences. My husband an I are both excited to continue learning from rpersonalfinance. Assistant: Way to go!!! Cars a wierd thing. I live in a highly competitive city, and cars are used to flaunt wealth. Thats silly as hell. A car should be reliable. Although Im not going to lie-it hurt my heart when I traded in my 14 Cadillac CTS for a Nissan Rogue. Just a protip: try to aim for a conventional loan. There are programs with 5 down for a conventional loan rather than an FHA. One of the biggest downfalls of FHA is PMI - you never get rid of it with FHA. On Conventional loans, as soon as you hit 80 LTV, that extra money you were paying for PMI can go in your pocket or towards the principal pay your mtg off faster and save interest!.Human: THANK YOU. Putting only 3.5 down feels embarrassing. We plan on doing at least 5, but we want to gauge our budget more on the mortgage payment than just buying what we are approved for. Right now were comfortable around 200k, which keeps our mortgage payment about the same as our current rent. Edit: perhaps my caps-locks came across as patronizing instead of excited.  <response>: I also notice that you mention USAA insurance... Do you guys qualify for a VA home loan? Yes, there is a one time funding fee, but its a way to put down a small percentage and not get screwed around on PMI, or a piggyback loan. The 5 you want to put down will cut the funding fee rate by more than half. You can also roll the fee into the mortgage amount. 