The Running of the Credit

By
Mortgage and Lending with Guaranteed Rate, Marin County, CA NMLS: 22343

The Running of the Credit

 

I have never been to Pamplona, Spain, and I've never run with the bulls, but I have known two individuals who did.  One came back with some fascinating stories about the experience and the other one, tragically, did not.  We're not going to dwell on either of them here, but instead discuss the fear that many have when they go to apply for a home loan.  Long has the myth been propagated that simply by having a mortgage lender pull credit, a borrower will see his pristine, 800+ FICO scores trampled into the 500-range by the mere making of a credit inquiry.  Instead of mustering the machismo of the ghost of Hemingway, they look on from the Basque balconies, afraid to test the cobblestone alleyways of pre-approval because they believe that simply by having a lender make a "hard pull" on their credit, they will be forever condemned to usurious credit terms.

 

Chill out.  Have another kalimotxo...

 

When a home loan applicant completes a pre-approval and a mortgage originator (like Guaranteed Rate) pulls credit, we are running a residential mortgage credit report (RMCR) and we are accessing a credit history and credit score from all three repositories; Equifax, Experian and Transunion.  Our inquiry will look different to the FICO model than a credit report pulled by a department store or an auto dealer, for example.  Very different.  And here's the most important thing: So long as you make your mortgage inquiries in a condensed window of time, they all count as a single inquiry.  How long is "a condensed window?"  Great question and one with a varying answer.  The consensus here seems to be not more than 30 to 45 days.  The FICO model allows for prudent "shopping" of big ticket items, like a mortgage, and this is your window to work with any number of lenders to get the information you require to make an informed decision.  This opportunity comes around once per year, though one should take solace in the fact that traditionally, shopping for a loan might only occur once every five to seven years, if averages hold.

 

While we're on the topic of traditions, don't forget to wear your white outfit and red bandana when you run with the bulls.  Likewise, let's start a new tradition of deftly sidestepping those mortgage lenders who tell you not to have another source pull your credit after they've taken your application.  On the contrary, if you have any doubt that you've obtained the best service and terms, use your window of opportunity to your advantage and make another inquiry with us today.  But don't look back, and ¡correr!

 

The sun also rises, 

 

 

Robert J. Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 Fax: 415-366-1590
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate's Human Resources Department.

 

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood ChicagoIL 60613 - (866) 934-7283

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Topic:
Home Buying
Location:
California San Francisco County
Groups:
Active Rain Newbies
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The Lounge at Active Rain
"Whacked"!!!
Bananatude
Tags:
credit report
credit score
fico
mortgage
home loan
jumbo
california
inquiry
credit pull
application
preapproval
rmcr

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Show All Comments
Rainmaker
1,550,753
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hi Rob,
Cute analogy.  Like in the Running of the Bulls, there are success and failure stories in the realm of credit scores.  Thanks for the clarification.

Sep 19, 2018 08:30 AM #1
Ambassador
4,381,557
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Hi Rob- very interesting analogy and I did follow your link to the sad story of that 22 year old man.   Thank you for the explanation of making inquiries in a condensed window of time. 

Sep 19, 2018 08:41 AM #2
Ambassador
4,381,557
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

                                                   

                             Congratulations, you've been featured

                                                 in the group Bananatude. 

Sep 19, 2018 08:43 AM #3
Rainmaker
2,844,889
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

I like the picture, Rob!  I always wanted to run with the bulls.  However, the size of the horns seems to become more threatening each year, and the quickness of my feet is beginning to linger!  Perhaps, in another life!

Sep 21, 2018 08:20 AM #4
Ambassador
4,381,557
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

                    

                                           Thank you, Rob. 

Sep 22, 2018 05:51 PM #5
Rainmaker
3,773,748
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hi Rob - a very good analogy and an excellent post title. Good information. 

Sep 23, 2018 04:44 AM #6
Ambassador
4,325,590
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Hi Rob

That's a great analogy! Good to know about the window of opportunity - I bet most people aren't aware of this.

Jeff

 

Sep 23, 2018 08:40 AM #7
Rainmaker
251,943
John Henry, Florida Architect
John Henry Masterworks Design International, Inc. - Orlando, FL
Residential Architect, Luxury Custom Home Design

I don't know Rob.  Still sounds iffy.

We bought two expensive SUVs a few years ago within days and the second dealership did not see the first nick, so it may be true about multiple mortgage loan inquiries done in a short period but I think they will show up after a week or so.

How does that affect buying furniture on credit, fixing up house problems,  etc. in another few weeks?

Sep 23, 2018 09:42 AM #8
Rainmaker
1,630,473
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

What would you say to the person who goes for pre-approval, learns that he or she needs to do a bit of work on credit scores, then comes back a few months later to try it again?

Will that first inquiry have done much damage?

Sep 23, 2018 10:10 AM #9
Rainmaker
2,564,973
Rebecca Gaujot, Realtor®
Lewisburg, WV
Lewisburg WV, the go to agent for all real estate

Well thanks for this explanation on making inquiries in a condensed window of time...I didn't know this and will pass it on.

 

 

Sep 23, 2018 03:37 PM #10
Rainmaker
594,930
Pat Starnes-Front Gate Realty
Front Gate Real Estate - Brandon, MS
601-991-2900 Office; 601-278-4513 Cell

Your explanation makes perfect sense, and thanks for clearing that up. However, does the same situation apply when car dealerships pull credit? I had a borrower a few months back. They closed on their home with a satisfactory credit score, then a month later went to a dealership. Their credit score dropped significantly and their loan denied. Can you offer any insight here? Sorry I don't have the exact scenario... 

Sep 23, 2018 05:06 PM #11
Rainmaker
2,198,929
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

Great analogy! I'm not the adventurous type....bulls or real estate.

Sep 23, 2018 07:12 PM #12
Rainmaker
1,063,074
Kevin J. May
Florida Supreme Realty - Hobe Sound, FL
Serving the Treasure & Paradise Coasts of Florida

Rob, hardly anyone expresses to the public about this window of opportunity. It wasn't always this way so their fear was valid although not to the extremes you cited. I'll stick with mortgages and let others run with the bulls. Here via Kathy Streib 

Sep 23, 2018 07:37 PM #13
Rainmaker
1,649,532
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty - Kalispell, MT
The House Kat

Interesting analogy although I have no desire to run with the bulls, but definitely do want to know more about the credit process. 

 

Sep 24, 2018 11:16 AM #14
Rainmaker
1,027,570
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Interesting!  I did not know that more than one credit pull in a close time frame would count as one.  Thank you for sharing that tidbit.  Sorry to hear about the other guy who didn't come back with a happy experience from the running of the bulls!

Sep 24, 2018 06:36 PM #15
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Rainmaker
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Rob Spinosa

SVP of Mortgage Lending, Marin County
Can I Get a Jumbo Loan with 10% Down?
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