So heres a silly one for you.... Regarding Credit Scores...

[WCGreen]

One of the factors that decreases your credit score is too many inquiries within a 12 month period...

We are shopping for a refinance...

Every time we speak with a different "broker", they look at the credit score.

How are you supposed to shop for the best deal if you are jeopardized each time your credit history is opened?

What a great system...

[checks-n-balances]

1. I agree with you - you're damned if you do/damned if you don't

The whole thing is a racket. The whole credit score industry has bloomed since GWB first stole office.

[sailor65]

2. You're probably ok.

There are different types of inquiries, and not all affect your score. A "Soft" inquiry is what most brokers will do at the outset to figure out at what level to start you in terms of (What they see as your) creditworthiness. A "Hard" inquiry is an actual application process, when the broker submits a request for the "Full" report, often the RMCR (Residential Mortgage Credit Report). That one does list and affects your score.

If all you've been doing is shopping brokers for good terms, you probably have gotten "Soft" hits, and you should be ok.

Not that the system isn't crap, I'm just suggesting you might not be as screwed as you feel.

[WCGreen]

8. Thanks!

That makes sense.

[aquamarina]

3. Actually -

when you shop for a refinance, this rule does not apply - as long as you actually complete the refinance within a 90 day period. Credit rating agencies actually understand that most people who are in the market for a mortgage loan will go to more than one place for rates, etc.

That being said, get a copy of one of the credit scores that has already been run on you - pay for it if you must - and use it when you are speaking with any prospective mortgage brokers. They are good for 90 days.

Also, unless you are actually filling out a loan application - a complete loan application - you really don't need to have a mortgage broker run your credit because the bank will, in fact the bank will also run another credit on you a couple days before you close on the loan just to make sure the money, credit and debts that you claimed on the loan application either haven't changed or have been reduced or paid off.

Good luck to you.

[HopeHoops]

4. Multiple inquiries of the same nature are generally lumped in as one.

That's true for mortgage, equity loan, and auto loans. The collection of inquiries is treated as one attempt to gain credit. That is NOT true for multiple credit card applications - those are treated as individual inquiries.

[Statistical]

5. One caveat is time limit.

For mortgages you have 30 days. For other loans you have 7.

I got approved car loan and then found a better rate 10 days later. It ended up counting as 2 inquiries.

The other good thing is most inquiries have a very small effect and no longer effect your score after 1 year.

[Hugabear]

6. Credit scores are one of Corporate America's greatest tools to keep people in shackles

Lose your job, or take a low-paying job, and see how quickly your credit rating tumbles when you can no longer keep up on your payments. And once your credit score starts dropping, it's very difficult to raise it back up to an "acceptable" level. It's a vicious cycle.

[notesdev]

7. The error

is thinking that the situation is as it is for your benefit. It is not. It is for the benefit of the people you are going to for a loan. If simply walking away from a bad offer comes with a penalty attached, you are going to get a worse offer than you might in an actually-free market.

[dionysus]

9. don't worry, because actually, when banks do inquiries for mortgages and refi's, those don't apply.

i was corrected by a wise DUer on this topic a few weeks back when i stated the same thing.