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
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.
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