7 Replies

Hi BP, questions abt credit pull, but first some background

 My husband and I are stuck in a lease until end of year, we cant purchase a house that we intend to "house hack" for maybe another 6 months.  That said,  i have a meeting scheduled with a bank lender to go over options we have, financing wise. Since we are not intending to buy for another 6 months or so, would it be best to not have the lender do a hard pull now? 

Also, is it true that if a multiple parties/lenders/bank do a hard pull over period 30 days, it will only show as 1 hard pull?

Thank you for taking the time to respond

If your credit is in a situation where pulling your credit makes a real difference, then you shouldnt be buying a house. A credit pull affects it to the tune of about 2 points

@Russell Brazil

Thank you for the reply, but I am shopping around and looking for the best deal and talking to multiple lenders over a period 30 days, it will only show as 1 hard pull? (assuming that each lender I speak to pull my credit)

Hi @Nilofer Sickander ,

Three things to consider:

1) Like @Russell Brazil said, mortgage inquiries are not treated the same as credit inquiries. 10 credit card pulls a month = credit applicant on downward spiral = high risk = FICO dump. Mortgage inquiries = credit applicant doing good in life = FICO knows this too.

2) Unless you are self employed or have something else wonky going on, no reason to start the process now. A month out is fine.

3) The best deal includes knowledge, competence, etc, not just rate. It's also the case that when a bank has too much business, they bump their origination costs to cover underwriter/operations/etc people needing overtime pay. The prevailing market rate for your scenario might be at no points today, but it might be the prevailing market rate plus 0.5 points when volume is "too high" and a bunch of overtime needs to be paid out, which might very well be when you go into escrow. Working with someone other than a bank or credit union that can't broker or correspondent lend might help avoid this.

@Chris Mason

Thank you so much for that, the first lender i called would not even have a F2F meet w/o me submitting a online application for him to do a credit pull which i was uncomfortable with since we are not ready to buy yet. Not to say that is an unfair requirement but I really wanted to meet more "players" to network as this is my 5-10 year gameplan

There's no reason to meet with a lender now if you are still 6 months away from purchasing. They won't lock you into a rate and would probably pull credit again when that time comes. It's great that you are preparing but you are 3 to 4 months away from getting that serious about financing.

@Nilofer Sickander don't feel pressured to have any lender pull your credit!  @Chris Mason is right.  There is no need to have that done this far out anyway.  Things will change and they will have to pull again once you are within that 30 day window anyway.  

It is likely that the lender is asking to pull because they don't want to be wasting their time with people not even qualified for a loan.  Being able to pull your credit gives them a financial picture of what type of borrower you are, and whether they will be able to find something for you, or not.  So, now you know WHY they want to pull it now....

So, here's a potential solution for you....I might suggest that you pull your own credit with FICO score.  It will not be the exact same as the lender pulls, HOWEVER, it can serve as a placeholder for the lender to evaluate you as a Borrower this far out.  It will not count against you at all when you pull your own, and you can get a free copy annually, although the FICO score may cost extra (unless you have FICO reporting through one of your credit cards.  Usually many of them like Capital One gives you your FICO for free).

Best of luck to you!

Like Russel Brazil said, unless your credit score is close enough to the minimum for a certain loan program you are looking for (like 580 for FHA), then it will not affect you that much. The hit is about 5 points or less, and multiple inquiries between 14-30 days are counted as one.

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