Preapprovals, Time, Inquiry Hits, and Looking for Credit

[Anonymous]

      I need help from the forum. My daughter and son-in-law were looking for their first home (they are late 20 somethings). They have/had fairly good CS (mortgage scores in the 740 range) and got a preapproval in early January 2018. They have been house-hunting and just could not find what they wanted/needed. They decided (because of rising interest rates) to forgo and wait for the coming housing drop. They made their decision (I agree) and do not wish to hear arguments about “no it’s not going to drop” or “this is actually the best time to buy.” I learned a long time ago not to argue with my daughter, but simply answer her questions as best I can.

     I told her she most likely took an inquiry hit as well as a hit on looking for credit, but her question is: “How long do most preapprovals from banks last?” If something comes up in 30, 60, 90, or 120 days; what is the limit for 1) a preapproval letter, 2) will another inquiry count as another hit?  If you don’t take the loan, will it count as 2 looking for credit or inquiries?

     I have my opinion on most of these matters, but I want to relay accurate info from the forum – a consensus is always better because I can weed through it. Maybe you folks can lead me to threads where I can do the research.

Thanks

Y

[NC_Mtg_Loaner]

Credit reports can be used for 90-120 days by the original lender for the purpose of originating a mortgage loan and that's typically how long a pre-approval lasts but anyone that's ever closed a loan knows a pre-approval is only an invitation to shop--getting the loan closed requires considerably more work.  

Multiple inquiries don't really "hurt" your score if there is a few points dropping here or there from multiple inquiries where one is shopping for a loan which is why if you are at 620 or 640 you may not want to have additional inquiries, but if you are 680+ it shouldn't really matter as long as you the consumer focus on the proper behaviours that keep your score on the rise throughout the process of shopping for a home in the event you or your lender need to or want to pull another report.

[JVille]

While the Pre-Approval with the lender may be good for a 60-90+ day period of time remember a couple points. The Pre-Approval is only good so long as their financial situation does not change (i know that’s obvious) BUT also when actually using that Lenders PreApproval the Realtors involved in any offer will expect an updated letter with a Current Date. It’s important to keep in touch with your LO and see how that is handled and how best to get ahold of him/her for that updated letter ASAP when the perfect home comes along.