Home Buying in Hewlett>Question Details

Alvy, Home Buyer in Wantagh, NY

If I shop around for a mortgage won't this affect my credit score?

Asked by Alvy, Wantagh, NY Sat Jun 21, 2008

I hear every say, go check out lenders, other banks, etc - every time a lender runs my credit it goes down - I have a credit score of 772 and it would have been higher if I hadn't run in previously - is this avoidable? And how much better can a lender get than 6.1% anyway?

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Good morning Mark,

->>>Go ahead and shop around... Yeah, go ahead and shop around, it's not my credit score .l.o.l..

Actually lenders can pull credit without a credit dump, it's what they do after the first time as it follows the chain of command and gets pulled again that causes all the problems ...

That said, you're always better off going to FICO.com and pulling your *entire* credit report and your scores, and then sitting down with a lender ... just tell them you're shopping rates based on your current figures, then have them print you a good faith estimate and use that to compare the next 3 ...

As far as rates are concerned, I'd wait until after the election if thats possible..

Good luck and happy hunting.

2 votes Thank Flag Link Sun Jun 22, 2008

Nobody knows for sure how the credit algorithim works, anybody who claims to is pulling your leg. That said it is common for a buyer to expierence some negative credit action when their credit is pulled. This one argument for using a broker who checks your credit once and has access to many sources of many rather than a bank who only has access (generally) to their own money. There has been talk that having your credit checked numerous times in a short period of time (shopping around) will have a lessen negative impact.

I wouldn't worry too much about your score anyay. A good rule of thumb is that the best credit breaks are at the 720 mark. Meaning you could have a 721 or anything else higher, you aren't going to get a better rate. I am sure there are exceptions to that rule but for the vast majority of lenders this will hold true.

As far as getting better than 6.1% that seems like a pretty good rate for todays market but it depends on the type of program you are looking a 30 year fixed rate will have a different rate from a 15 year fixed which will be different from a 3-1 ARM.

Moral: Go ahead and shop around, make sure to include a couple of banks and a couple brokers in the mix. I think you will find however (as did one of my clients recently who insisted on getting quotes from 6 different people) that all of the rates will be within 1/8% on an apples to apples comparison and a competitive loan officers fees should be within a few hundred dollars of another. I hope that helps.

Cameron Piper
Web Reference: http://www.campiper.com
0 votes Thank Flag Link Sun Jun 22, 2008
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