It's ok to shop for a mortgage – it's also ok to have more than one lender pull your credit report.
Everyone knows that credit inquiries can affect your credit score, however credit scoring systems have been changed since the mid 90's to allow for multiple mortgage inquiries. Mortgage debt tends to be "good" debt. Low rates mean lower payments and that helps everyone.
You have the right to shop around for a mortgage and it's good to do so! Most lenders are similar in pricing but sometimes the fees are different and it can pay to shop around. A credit inquiry can affect your credit score and it happens when mortgage companies, credit card companies, or any other financial service pulls your credit report. Mortgage inquiries are treated differently than other inquiries. You can shop for a mortgage and have multiple inquiries without it affecting your score. You need to shop within a short time range. I have been told different stories but typically an inquiry will not affect your score for 30 days and multiple inquiries within 30 days are treated as one inquiry.
The most important part of shopping for a mortgage is to contact different lenders on the same day – especially if you are checking interest rates. Rates change daily and so if you contact different lenders on different days, you will get different interest rates. Also as you are shopping for lenders, make sure you are keeping your other credit good. Do not apply for other credit such as car loans, credit cards, etc. Do not run up credit card balances as that will affect your credit score.
When I know someone is shopping for a mortgage, I may not pull a credit report but will ask if you know your credit score. That way I can give you an interest rate quote and a loan summary but it won't affect your credit. Once you have decided that you are going to work with me as your loan officer, then I will pull your credit report. If you have someone else pull your credit report, you may want to ask for a copy of the report or at least what the score is, then you will know that information for other lenders.
Leslie Vanderwerf, NMLS ID#335509, Summit Mortgage - Email – Website
