How many hard inquiries in the span of a year?

[Anonymous]

Hi all,

My wife and I are planning three large purchases between now and next summer, but not necessarily co-signing all of them.

First, my wife will be leasing a car via BMW FS. Her FICO 8 is 703 so I might co-sign that if it's not sufficient. My score is currently 780 but is usually 800+. I do have a personal loan though. I already have a single hard pull on my CR from applying for the amazon credit card a few months ago.

Next spring we'll be applying for a mortgage together, and then next July my lease is up on my car so I'll be applying for either another lease or a car loan.

Worst case for me in this case is 4 hard pulls in the course of one year. Would it be wise to not co-sign the lease on my wife's car to save the pulls for the mortgage and auto loan next year?

Thanks!

[CreditInspired]

Hi and welcome to myFICO

Let's break it down. Your plan is to apply for a mortgage in April 2020--in ~8 months. The concern really should be the DTI, not the 4 HPs. A carnote has a huge impact on DTI. 

Also, it's best to not apply for any new credit 12 mos prior to mortgage application.

Since both you and DW will be on the mortgage, please note it's her middle score that will be used--not yours. So under those circumstances, she shouldn't be applying for anything that would lower her scores. And you really should know what both of your mortgage scores are, not bank scores. Since her FICO 8 is at 703, her mortgage score is more than likely lower. You want the best mortgage rate possible. 

You didnt ask, but IMHO, I suggest between now and mortgage application, to work on whatever is suppressing her scores in order to  increase them to put you both in a better position creditwise. 

GL2U

[sarge12]

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@CreditInspired wrote:

Hi and welcome to myFICO

Let's break it down. Your plan is to apply for a mortgage in April 2020--in ~8 months. The concern really should be the DTI, not the 4 HPs. A carnote has a huge impact on DTI. 

Also, it's best to not apply for any new credit 12 mos prior to mortgage application.

Since both you and DW will be on the mortgage, please note it's her middle score that will be used--not yours. So under those circumstances, she shouldn't be applying for anything that would lower her scores. And you really should know what both of your mortgage scores are, not bank scores. Since her FICO 8 is at 703, her mortgage score is more than likely lower. You want the best mortgage rate possible. 

You didnt ask, but IMHO, I suggest

between now and mortgage application, to work on whatever is suppressing her scores in order to  increase them to put you both in a better position creditwise. 

GL2U

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OK, just curious about this...why would the lender use her report in favor of his? Is it just the lowest of the 2 joint owners middle score? I can't believe that her gender would be why, and still be legal. Is her middle mortgage scores for certain lower than his just because her fico 08 is? At one time, my mortgage score was a good bit lower than my fico 08 due to how that fico score treated the American Honda Financial as a finance company. Fico 08 seems to treat any revolving debt less harshly as well. You seem quite certain it is her middle score that will be used, but why? This might explain a lot about the first mortgage I and my ex-wife got. My score was much higher than hers, but my DTI was too high to get it alone.

[Citylights18]

I'm not sure if a middle mortgage score of a co-applicant is a deal breaker or not but I think anybody who is preparing to buy should have their vehicles paid off just to free up more DTI space.

I know most people don't feel they have time to wait for that or for their credit scores to move up but it might be worthwhile taking an extra 6 months or a year to have all of that together.

[Jnbmom]

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@sarge12 wrote:

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@CreditInspired wrote:

Hi and welcome to myFICO

Let's break it down. Your plan is to apply for a mortgage in April 2020--in ~8 months. The concern really should be the DTI, not the 4 HPs. A carnote has a huge impact on DTI. 

Also, it's best to not apply for any new credit 12 mos prior to mortgage application.

Since both you and DW will be on the mortgage, please note it's her middle score that will be used--not yours. So under those circumstances, she shouldn't be applying for anything that would lower her scores. And you really should know what both of your mortgage scores are, not bank scores. Since her FICO 8 is at 703, her mortgage score is more than likely lower. You want the best mortgage rate possible. 

You didnt ask, but IMHO, I suggest

between now and mortgage application, to work on whatever is suppressing her scores in order to  increase them to put you both in a better position creditwise. 

GL2U

---

OK, just curious about this...why would the lender use her report in favor of his? Is it just the lowest of the 2 joint owners middle score? I can't believe that her gender would be why, and still be legal. Is her middle mortgage scores for certain lower than his just because her fico 08 is? At one time, my mortgage score was a good bit lower than my fico 08 due to how that fico score treated the American Honda Financial as a finance company. Fico 08 seems to treat any revolving debt less harshly as well. You seem quite certain it is her middle score that will be used, but why? This might explain a lot about the first mortgage I and my ex-wife got. My score was much higher than hers, but my DTI was too high to get it alone.

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As far as I know they use the lowest middle score , so if the wife's is lower they will use that and vice versa.

[ccquest]

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@sarge12 wrote:

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OK, just curious about this...why would the lender use her report in favor of his? Is it just the lowest of the 2 joint owners middle score? I can't believe that her gender would be why, and still be legal. Is her middle mortgage scores for certain lower than his just because her fico 08 is? At one time, my mortgage score was a good bit lower than my fico 08 due to how that fico score treated the American Honda Financial as a finance company. Fico 08 seems to treat any revolving debt less harshly as well. You seem quite certain it is her middle score that will be used, but why? This might explain a lot about the first mortgage I and my ex-wife got. My score was much higher than hers, but my DTI was too high to get it alone.

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Quicken Loans says the same thing if that is a better source for you:

Minimum Credit Score Needed: You’ll need a minimum credit score of 580 to qualify for an FHA loan that requires a down payment of just 3.5%. There is no minimum FICO® Score, though, to qualify for an FHA loan that requires a down payment of 10% or more.

However, FHA loans are originated by private lenders, and these lenders will usually have their own minimum credit score requirements. For instance, the minimum FICO® Score for an FHA loan through Quicken Loans is 580.

For a standard FHA loan, a minimum of one credit score is required to qualify. If your lender obtains all three of your credit scores, it will use the middle score for consideration. If you apply for a mortgage with your spouse, lenders will use the lower of the two middle credit scores.

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[ldkcivilservant]

CreditInspired made an assumption. More than likely a correct one.

The OP stated that their spouses score was 702, and his is around 780. Everything else being equal, you can pretty much assume that his mortgage scores are higher than hers.

Which is why CI said her middle score. Nothing sexist in that.

[Anonymous]

Thanks for the replies! Hers is a little suppressed right now for two reasons:

First is there was apparently a 90 day late 5 years ago on one of her med school loans she wasn't aware of. We looked at her payment history and it looks like she made a normal payment in the month that the credit report is saying she has a 90 day late so we're disputing that.

Second is probably just the fact that she has med school debt. About $350k I think.

Combined we make about 500k per year. She currently has no car payment but has a 12k personal loan, and zero revolving debt. I have a 30k personal loan, zero revolving debt, a car lease, and about 35k in student loans. Not sure if that helps fill out the DTI picture.

Overall, it looks like our total minimum obligations would work out to about $8k, which is well below 43% for DTI, right?

[ccquest]

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@Anonymous wrote:

Second is probably just the fact that she has med school debt. About $350k I think.

Combined we make about 500k per year. She currently has no car payment but has a 12k personal loan, and zero revolving debt. I have a 30k personal loan, zero revolving debt, a car lease, and about 35k in student loans. Not sure if that helps fill out the DTI picture.

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Doubt it's the student loans. I have 130k and my scores were in the 800s before my CC app spree and new student loan refi. Mostly due to the late payment I'm sure.

And of course you can both play the AZEO card when you get closer to your prequal/mortgage application so things are as high as possible then.

[Anonymous]

Since you're only 8 months out from a possible Mortgage, i think the wiser choice would to be to wait on the new car and put that payment towards her Loan. Plenty of time after the house purchase to buy cars, and it's better to get the best rate on the Mortgage versus the auto.

As for having that 90 day late removed that will held alot, so good luck on that!