I would like to know how it is that credit bureaus take away your right as a consumer to bargain, by penalizing you for doing so and lowering your scores. Also, just how much does it hurt your credit rating if you do mortgage inquiries.
2007-06-13 10:16:02 · 7 answers · asked by myrnpr 2 in Business & Finance ➔ Credit
I have been doing mortgages for a long time, and have yet to see someone's score drop because they went mortgage shopping. Car shopping yes, mortgage no. I know a lot of brokers and banks that tell you otherwise because they want to keep the competition out. I have heard it can drop your score if you go somewhere that does more than mortgages, like a Beneficial, but I don't know how true that it.
The reason they drop your score when you pull your credit is because that could mean you opened a new tradeline. Also, because if you are trying to establish a lot of credit quickly, it generally isn't because your finances are in order.
Another point, most brokers that are shopping for the best rates for their clients only need to pull credit once, until they are far along in the process. Then they lender may need to pull it on their own. Usually if a broker is having it pulled at more than one lender, it means the borrower isn't in good shape, and he is doing the best he can to get the loan closed. The shady ones generally only use one or two lenders, because they know where they can get away with their shadyness.
2007-06-13 11:00:08 · answer #1 · answered by blibityblabity 7 · 0⤊ 0⤋
What winds up happening is that it pops up as an inquiry. Every inquiry is a possible loan. This lowers your score. This happens to people who use not so honest mortgage brokers as well. The mass submit applictions to many different banks and see who approves it and who gives them the highest commission. Car dealers do it as well with auto loans. A lender looking at that is thinking the following. (1) did they get a loan from the lender on the report and if so how much. Many people have tried to get 2 loans on the same property. The loan information takes 30 days to appear on a report(2) If they did not get the loan from that lender why not.. maybe that lender did not approve it, maybe that lender knows something I don't. So acordingly the score drops every time you have an inquiry. You need to shop rate and best deal before applying for any kind of loan anywhere. Especially high ticket items like homes and cars. 1 point of interest can cost you a ton over 5 years on a car or 30 years on a home.
2007-06-13 10:34:17 · answer #2 · answered by asccaracer 5 · 0⤊ 0⤋
The empirical model is structured such that inquiries create negative points. The logic is that if you have a large quantity of inquiries in a short time, you must be getting denied (The actual credit decision is never recorded or reported to the credit reporting agencies, it uses a behavioral model to predict defaults).
You should know rates, terms, points BEFORE applying. The mortgages rates are published in just about every newspaper, plus, they are available on line.
Think before you act. Have a strategy. Stop wining.
2007-06-13 10:22:14 · answer #3 · answered by Anonymous · 0⤊ 0⤋
I don't believe scores drop significantly if you shop around.
You can save a lot of money by shopping around, and the "cost" of a small change in your credit rating is insignificant.
So I say: shop around and don't worry at this time about your credit rating. A year from now you'll have a great mortgage and no one will care that a year before you were shopping.
2007-06-13 10:20:29 · answer #4 · answered by hottotrot1_usa 7 · 0⤊ 0⤋
This should not happen.
The system is designed to recognize when people are doing this and if the inquiries are all made in a 14-day period While they all show on your credit score wise they are lumped together and only count as one pull. About 3-5 points.
The same is true for when you are shopping for the best deal on a car.
2007-06-13 10:38:14 · answer #5 · answered by ? 7 · 0⤊ 0⤋
There is not anything you have got to fear approximately. Your credit score ranking might now not be massively affected together with your plans. However, making plans on credit score and dangerous you bring and treated it concerns.
2016-09-05 15:40:06 · answer #6 · answered by ? 4 · 0⤊ 0⤋
Because your credit is being ran more than 1 time a year which is allowable.www.transunion.com or www.equifax.com
will give you more information requarding this.
2007-06-13 10:19:52 · answer #7 · answered by Kim M 1 · 0⤊ 0⤋