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Hi
So we are trying to decide when the best time apply for a $30k loan will be.
Our scores have been bouncing from 680-700 recently and we want to apply when we're at the highest possible, ideally over 700. We recently hit 700 MyFico8 on TU (followed closely by 696 on Exp), and then all of the sudden dropped like 15-20 points across all agencies.
Seems like this was due to our mortgage being sold to a new lender (we had no idea until we got the letter in the mail). Our current mortgage with our old bank is now listed as "Paid in full, Closed" and the new lender hasn't appeared yet, so on our credit reports, it looks like we have NO open mortgage.
We make our "first" mortgage payment to the new bank Cenlar on July 1. Should we expect even further of a drop when this shows up as a "new" account? Will it appear we are seeking out too much new credit, with a "new" mortgage reporting only 1 month, or will they be able to tell this is linked from the old mortgage? We've steadily paid the mortgage for a year now, ever since we opened the loan, with no lates ever.
Seems like bad timing they had to sell it right as we were preparing for a new loan!
We can't wait too long for the loan...45 days tops. I am wondering if we should just apply now and see what we can get with FICO 8's around 680.. or wait until the mortgage does report to see if that helps... or try and wait the full 45 days to see what that does. I don't want to have a flurry of inquiries unless we're going to get the loan we want, so I'm trying to figure out how to time it just right!
Credit is SO crazy to figure out sometimes. But if I'm going to be stuck paying off a loan for the next 5 years, I want to make sure I get the best interest rate possible.
I think that the presence of a mortgage on your report (even at full utilization) would get you back a decent portion of the points you lost from going from having one to it being closed. What was the utilization at on the mortgage that was just closed?
It's pretty high... we had a 0 down VA loan so right now with our previous lender we had an original loan of 280k and a balance of 270k. Still, our scores had been steadily going up (slowly) every single month since we opened the VA loan, and this was our first major drop. Just bad timing.
I'm hoping when the new mortgage reports it will go up.. but I am worried it might dip even further down at first before rebounding.
Mortgages go from one lender to anothe often. My Wells Fargo mortage was sold to someone a couple years ago.. Didn't effect anything.. That sounds like what happened but then you mention new mortgage.. It's the same mortgage just someone else technically owns it. With me, I still pay the mortage to Wells Fargo (At least through their website)..
^^^The mortgage loan (note) can be sold and the mortgage servicing can also be sold. They don't have to be sold to the same company or at the same time. In your case, mitchblue, it looks like WF sold the mortgage loan and kept the servicing. Not a surprise, WF is one of the big players in mortgage servicing.
I have had many mortgages and from time to time they are sold. My credit didn't experience a drop at the time of the note/servicing was sold and generally there is a notation in the notes section of your CR under the tradeline that the loan was sold. At least that is what I experienced.
@StartingOver10 wrote:^^^The mortgage loan (note) can be sold and the mortgage servicing can also be sold. They don't have to be sold to the same company or at the same time. In your case, mitchblue, it looks like WF sold the mortgage loan and kept the servicing. Not a surprise, WF is one of the big players in mortgage servicing.
I have had many mortgages and from time to time they are sold. My credit didn't experience a drop at the time of the note/servicing was sold and generally there is a notation in the notes section of your CR under the tradeline that the loan was sold. At least that is what I experienced.
I thought the loan servicer keeps the tradeline?
In my case Chase sold both servicing and the loan to Union Bank; Chase tradeline reports closed (transferred in the notes) and the Union Bank tradeline basically duplicated the Chase one minus the prior payment data. Open date, original balance both same.
I'd have been a little annoyed by that short term if I didn't have so many accounts anyway, turns out my AAOA wasn't impacted much at all (like .5 months) as a result of it haha.
Was strange as at least when I picked up the loan it seemed like Chase would likely keep the servicing portion, but they didn't. They did me square at least, as I'd had a small rewards earning thing with them based on my autopaying my mortgage... cut me a check for the expected rewards payouts over the remaining 13 years.