How much drop in score if I add a Mortgage account?

[Red1Blue]

I am planning on buying a house for around $300K. This is the first home mortgage loan on my CR. I do have Car and other loans that are paid off. My CC balance is around $2K my total CC CL is around $50K.

How much score hit would I take if I were to add the mortgage to my account? I live in NH and it is not considered as risky state for mortgages.

Any suggestions as to what might happen to my scores if I proceed with this Home mortgage?

[Junejer]

I got a small increase on my TU for adding a mtg recently.

[Lel]

The conventional wisdom is that mortgages have an overall positive effect on one's credit score.  There might be an initial dip when the account is opened, but generally you recover all those points and more once you start making payments.

[Anonymous]

I had about a 4 point drop, and from what I understand, I should gain more back after a few months of payments.

In the long run it helps.

[Madison]

My EQU dropped 2 points when my mortgage account showed up on report.

[RobertEG]

If you get a mortagage and a home, then FICO probably is not too important in then next few months... and congrats, in this tough market if yoou close it!

A mortage loan has a plus and a minus.  If you have alreaqdy app'd for the loan, then the new inq hit is behind you, but regardless, that only lasts for one year, and is not major. Max of 5-10 pts for the inq.

The only other neg in a new mort. loan is an increase in %util, but mortgage loans are scored as having the lowest affect on % util.  They are not grouped with your installment accounts.  Again, not much neg affect.

ON the po9sitive side, you will get a boost in you credit mix portion of FICO scorng.  Mortgage loans are a big factor in credit mix.

There may be some minimal drop in your immediate score, but FICO is only important when you app for new credit.  If you dont plan to go on a new credit spree after mortgage loan approval, then it will probably become a plus long before the minusus have drifted away.

FICO likes mortages in the pocket!

[scott46401]

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@Lel wrote:
The conventional wisdom is that mortgages have an overall positive effect on one's credit score.  There might be an initial dip when the account is opened, but generally you recover all those points and more once you start making payments.

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I hope this is the case....I refinanced back in July, and only in the past month has that new account shown

up on EQ and EX, but has yet to appear on TU. Just recently I checked the TU Fico and got 704....

first time I've had a 700 score(to my knowledge) and would like to keep it up there!

Message Edited by scott46401 on 12-05-2008 02:12 PM