My comments below in blue.
@Anonymous wrote:
Thanks for the replies guys. I never heard about Rapid rescore. I'll check with my loan officer. Can I request the lender for RR if it is more than 14 days? The lender pulled my credit on Feb.20 which is more than14 days.
The key idea that you need to be clear on is that the RR involves pulling your reports again. This means it is another inquiry.
RR's are typically done when a person is frantically trying to get his scores up just before he closes on the property. Since mortgage inquiries don't have any effect on your score until 30 days after they are done, having extra inquiries during those final days before you close is not a problem. By the time they kick in, you already own your house.
But you are not planning to buy a house until August. That's much longer than 30 days from now.
On the other hand, if the RR and your initial mortgage inquiry occured within 14 days, then they would be lumped together as one inqury (that's another FICO rule to protect buyers). But the two inquries are NOT occuring within 14 days of each other.
Therefore when final underwriting begins (July/Aug), and they pull your scores one last time, they will see the inquiry from Feb, and the RR done in March/April. Thus the RR would be an additional hard inquiry and therefore an additional 5 points or more off your score. By pulling your mortgage scores yourself here at myFICO, it becomes in contrast a soft inquiry and those are not visible to FICO or to lenders.
The rates are not locked yet but just got the mortgage commitment from the lender. If we go for joint mortgage along with my wife, the loan officer said we are easily qualified for conventional. Her credit profile is solid with less than 20% CC UTIL, paid auto and 713 MMS. But our idea is to have just myself on the mortgage loan (my salary is higher) which is why he suggested to refinance the car loan to get the DTI below 39%. I am not gonna apply for anymore credit until I close. I can make more payments to CC if I have to.
The mortgage models like it a LOT when they see most of your cards showing a $0 balance. This is a scoring factor different from CC utilization. If you think you could pay off your Citi DB entirely (thus resulting in one more CC at $0) and also get your total utilization down to < 8.9% that would give you a definite benefit. Frankly if I were you and you can do this without grave hardship I would just do it now as part of your plan to optimize your reports. Do it now BEFORE your pull your mortgage scores in April, I mean.
I am also planning to purchase the 3B report with MyFico next month after the auto refi is reported. So I can know where my scores are and get to know the plan of action then.
Good. Except, you should really wait to pull your mortgage scores until your reports are optimized in all respects. Unless of course you'd like to pay for your mortgage scores three or four times. So I would wait till all the car loan accounts have changed (new account reporting and old account reporting closed with a balance of $0) as well as all your CC balances the way you want them plus 32 days having elapsed since your last mortgage inquiry.
Side note: DCU just provided the EQ score on Friday. Now I am at 731 after the paid CC are reported!!! but car refinance has n't reported yet. EQ was at 694 on Feb.20 when the lender pulled and it was my MMS. Hopefully I won't lose much points after the auto is reported.
PS. Having high mortgage scores is important not just for the mortgage but also for the PMI. An increase to your scores benefits your PMI cost till the scores hit 760 I believe.
