Sand Springs, OK · Member since 2015 · 38 posts · 10 votes
Should I simply call the banks to get a ball park on the rate and do my calculations with that estimated number or will I need to apply and get the rate available for investment properties at several banks? Won't the latter ding my credit?
Specialist · Chicago, IL · Member since 2015 · 870 posts · 345 votes
10y
You can get pre-approved for whatever amount you need. This will ding about 5 points on your score. Then, use the letter to make offers. Once you have it under contract, you can apply to get the best rate, but you will need to move fast. I would recommend getting a few lenders and compare their offers, have them compete for your business.
Investor · Flower Mound, TX · Member since 2016 · 245 posts · 192 votes
10y
Having inquiries rarely negatively affects your scores. I'm curious where Frank determined this 5 point ding from.
If you start having multiple inquiries spread out over a long period of time, then it may start affecting your scores. However, a credit repair expert that I have worked with for a few years told me that if a borrower gets a similar inquiries (all mortgage inquiries) in a short period of time (2-3 weeks) that it will not negatively affect your scores. The credit bureaus understand that consumers need to shop around for rates.
My suggestion is shop around online and look at advertised rates, pick a few local lenders / banks and ask them for a rate quote. If they do have to pull your credit that is fine, just do it all in the same 1 week period. Then pick your best quote.
Chances are almost all lenders are going to quote you essentially the same rate and/or will factor in discount points or lender credits to raise or lower the rate.
Having inquiries rarely negatively affects your scores. I'm curious where Frank determined this 5 point ding from.
If you start having multiple inquiries spread out over a long period of time, then it may start affecting your scores. However, a credit repair expert that I have worked with for a few years told me that if a borrower gets a similar inquiries (all mortgage inquiries) in a short period of time (2-3 weeks) that it will not negatively affect your scores. The credit bureaus understand that consumers need to shop around for rates.
My suggestion is shop around online and look at advertised rates, pick a few local lenders / banks and ask them for a rate quote. If they do have to pull your credit that is fine, just do it all in the same 1 week period. Then pick your best quote.
Chances are almost all lenders are going to quote you essentially the same rate and/or will factor in discount points or lender credits to raise or lower the rate.
I hope this helps.
Hi,
The hard pull impact on getting pre-approved is minimal. 5 points in my case. It all depends if you had more hard pulls recently, and other factors. Go to creditkarma and other sites out there can run a prediction.
Note that there are soft and hard inquiries, I won't discuss that basic definition.
It's not a good idea to have multiple hard pulls on the same week, in fact, this is useless to get pre-approved. Only do this once you know you are getting a mortgage. You can check for multiple companies, this will not affect your credit more than having a single one, because the pulls are related to the same purchase. If you don't purchase the place, well, that's another story.
Lenders don't provide the same rates and they don't provide the same points. Many people ignore they can negotiate almost everything. Be honest and tell them you will shop around for the best mortgage. Tell them you know you have good credit and you will get the best price. They should give you the best price from the get go. They will try to confuse you with points and rates. Have a talk about this and use a spreadsheet. You can save some money.