Does the credit need to be unfrozen till closing?

Question

I am about 25 days from closing on my first investment property and the mortgage loan officer wants me to keep my credit unfrozen (from all 3 credit bureaus) till the day of closing. Is this normal? When I talked with her, I was told that this is the norm as they want to monitor my credit everyday till closing to make sure that there is no change in my credit history. I am worried about the risk of identity theft.  Would really appreciate inputs/replies from the group. Thank you.

Vishal Chandan · Answer

Thank you Derek and Ryan. Truly appreciate it.

Russell Brazil · Answer

Yes. Lender will make sure you dont open any new trade lines or have increases on your balances. Your credit score needs to stay relatively the same from application to closing.

Erik Estrada · Answer

It will depend on the type of loan.

On a Hard Money and DSCR loan, there are several lenders that only do 1 hard inquiry and do not do any other inquires  until the credit report has expired (which is usually 90 days).

Patrick Roberts · Answer

Yep - your lender will be using an undisclosed debt notification service until after the loan closes. If your credit is pulled for any reason, you will have to complete a letter of explanation and possibly provide more documents to show that no new debt was incurred. If you do take on new debt or collections during this time, the lender will see and it will require that it be accounted for in your DTI (unless this is a DSCR loan).

Eric Veronica · Answer

You can re-freeze your report if you want.  You will just need to lift the freeze again about a week before closing.

Derek Brickley · Answer

Hey Vishal, yes that is standard.  As mentioned if you're concerned, just keep a close eye on your credit profile during that period!

Ryan Konen · Answer

Yes, it's normal for lenders to ask you to unfreeze your credit until closing. They typically do a soft pull close to the closing date to ensure there are no new debts or significant changes in your credit profile. To help with identity theft risks, you can monitor your credit closely or use fraud alerts, which allow creditors to verify your identity before extending credit.