tm.88
07-01-2008, 05:44 PM
One of my clients is attempting to be approved for a mortgage right now. The company doing so has taken a very long time and still does not have a answer. We have had to do 2 amendments to the purchase contract because of this. When i had mentioned using a different broker that should take no more than 5 days i was surprised by my answer....
I was just curious as to how many people thought that shopping around for a mortgage would affect your credit as shopping around for the best credit card would....
I found this article that should explain everything for those interested.
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Credit Scores and Mortgage Shopping
When you apply for a mortgage your lender or mortgage planner will almost always check your credit. Most Canadian lenders use Equifax for this purpose.
Here are a few things you may or may not know about the process:
When a bank or mortgage professional initially checks your credit score, your score goes down.
According to a source at Equifax, your score can drop anywhere from roughly 5 to 20 points on the first mortgage inquiry.
After the first inquiry, a 30-day clock starts ticking. During this time you can have multiple mortgage inquiries without negatively impacting your score. But there's a catch.
The person making the inquiry MUST use Equifax's "mortgage code" when requesting your credit score. (If you're a mortgage professional you can tell if you're using the right code by checking if "FM" is in your Equifax member number. )
Mortgage planners from all the big broker firms use the mortgage code.
Big banks may or may not use the mortgage code, according to the Equifax rep we spoke with.
Credit unions often have their own unique code.
_______________________________________________________
Factoid: When a lender or mortgage planner pulls your credit, he/she sees your credit score before the impact of that inquiry. The next person to check your credit will see a different (lower) score because the first mortgage inquiry will have reduced it.
http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2008/05/credit-scores-a.html
I was just curious as to how many people thought that shopping around for a mortgage would affect your credit as shopping around for the best credit card would....
I found this article that should explain everything for those interested.
__________________________________
Credit Scores and Mortgage Shopping
When you apply for a mortgage your lender or mortgage planner will almost always check your credit. Most Canadian lenders use Equifax for this purpose.
Here are a few things you may or may not know about the process:
When a bank or mortgage professional initially checks your credit score, your score goes down.
According to a source at Equifax, your score can drop anywhere from roughly 5 to 20 points on the first mortgage inquiry.
After the first inquiry, a 30-day clock starts ticking. During this time you can have multiple mortgage inquiries without negatively impacting your score. But there's a catch.
The person making the inquiry MUST use Equifax's "mortgage code" when requesting your credit score. (If you're a mortgage professional you can tell if you're using the right code by checking if "FM" is in your Equifax member number. )
Mortgage planners from all the big broker firms use the mortgage code.
Big banks may or may not use the mortgage code, according to the Equifax rep we spoke with.
Credit unions often have their own unique code.
_______________________________________________________
Factoid: When a lender or mortgage planner pulls your credit, he/she sees your credit score before the impact of that inquiry. The next person to check your credit will see a different (lower) score because the first mortgage inquiry will have reduced it.
http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2008/05/credit-scores-a.html