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Credit Scores: Don't Waste Your Money
Did you know that your credit score that you purchase online is not the same credit score your mortgage loan officer gets? You probably know that when you apply for a mortgage, your loan officer gets all three credit reporting agencies reports with three different scores. From your three credit scores, most mortgage companies use your middle credit score to determine your credit worthiness. However, some mortgage lenders use your top score, which can help you if you have one high credit score. Do you know that the credit score an auto dealer sees is not the same credit score your loan officer sees? Imagine our surprise to find out that my husband's credit score for purchasing my new car one afternoon was 50 points higher than his top credit score was earlier in the day when he refinanced an investment house. This happened because credit scores get computed differently for mortgages and auto loans! If you think that you have a great credit score because you recently bought a new car, think again. You may have been told that your credit score was 700 by a finance company.
Therefore, you think that you have the perfect credit score to buy a house. Don't be surprised to hear from your loan officer that your credit score falls short of a prime rate mortgage loan. You don't want to have your credit history checked too often. You do get a small penalty with a few points deducted when you have too many inquiries on your credit report. However, when you're shopping for a car or a home loan, the credit reporting agencies batch your inquiries into one.
In other words, you can call several mortgage lenders to shop for the best terms and rates without losing points. Don't waste your money buying your credit scores. These scores are not the ones real estate lenders get. Instead, get your credit scores FREE by calling a loan officer. Copyright © Jeanette J. Fisher.
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