Score dropped due to multiple pulls and it will cost me more to close now

[helaurin]

Long story, short version:  Several years ago, I checked my credit, found three accounts that were paid with zero balance and should have been marked as closed accounts (2 were mortgages). I initated a dispute inquiry as to why these accounts were open.  Bureau researched, found they should have been marked closed, and changed the account's status to closed - but left the disputes as open.

Fast forward to now: I apply for a new mortgage for a home I am trying to buy, and am told that I can't get a mortgage with these open disputes from years ago. (Those disputes should have been closed when they finished their research, but inexplicably, they weren't closed).  Mortgage company pulls my score using a third-party service several times - I'd been told that the disputes had been removed, and they weren't, until this morning. 

My scores were good on the first pull, but they dropped seven points due to the repulls needed to get a new report without the disputes (it is also possible that the credit bureau may have also deleted one of the closed-and-paid tradelines - I haven't seen the new report, but the customer service person on the phone initially said that they just deleted the entire history of me having previously paid off the two mortgages!).

Now this shifts me to a different (worse) credit band - my score went from 721 to 714.  I'm told now that I will need to come up with another $1,180 dollars to close the loan due to increased costs from Fannie Mae for having a lower credit score.  And in the meantime, interest rates edged up, so I'll be at a higher rate.

Am I stuck just being totally shafted?  If Equifax had closed those disputes when they had completed the research, I would have locked in at a lower rate (that will cost me an estimated $6,556.14 more in interest over the life of the loan), and would have paid less to close.  Does Equifax have any responsiblity to keep accurate records, to close disputes when they are resolved, and so forth?

[Anonymous]

well, you could always fight to get the stuff corrected, but you may very well loose the house you want because of it.  The lender will probably not be able to do much unless they are willing to eat some costs to keep the upfront $ down, but they usually do not do that because of a score drop on your end.  So you have to decide if with the new numbers, this deal is still what you want to do, or if you want to risk loosing it by fighting the discrepancies on the CR.

[helaurin]

Clarification:  The report data was originally inaccurate back in 2004 - 2006.  I initiated disputes, the inaccuracies were corrected for the accounts themselves, but then Equifax never bothered to close the disputes as resolved.  My score wasn't an issue, not until the mortgage company had to keep repulling the data to see whether or not the disputes were marked closed.  If those disputes had not been irresponsibly left open by Equifax, the original credit report pulled would have been fine, and my interest rate and closing costs both would have been lower.

I am not expecting the lender to do anything different.  I need to get this house - I am already in it as a tenant, and have to close on or before January 15th, 2010 - otherwise I and my two dogs will have no place to live. There is no way I would otherwise be able to find another property in my price range, complete negotiations, and move into another property before January 15th at this point (not to mention I this is the house I want to be in anyhow).

However, as a result of Equifax's failure to close resolved disputes in a timely fashion - I mean, seriously, these disputes were opened several years ago! - I am going to end up shelling out over $7,500 than I would otherwise have had to. 

Isn't there anyway that Equifax should be required to shoulder some of these additional costs?

[XAVIERSMAMA]

I guess you could try to get some recourse from Equifax, but I don't think it will go anywhere.  Credit reports have errors on them all the time, and generally it's been left as the individual's responsibility to check their reports for inaccuracies and correct them.  Yes Equifax should have closed the dispute, but you could also say that your mortgage company didn't need to pull so many times to check for the dispute removal.  I'm wondering if the hard pulls are the only reason your score dropped.  Is there any maneuvering you can do with CC balances to lower your util, do a rapid rescore maybe get the points back before you close? Unfortunately I think you're between a rock and a hard place without much recourse, but I could be wrong.

[Anonymous]

your score likely dropped because of the items being removed.  That would have lowered your average age of accounts and removed what was a good tradeline.  If they just re-ran your credit in the last couple weeks it has not affected your FICO score yet.  All mortgage inquiries are not counted towards score for at least 30 days and any within 2 weeks (sometimes even farther apart) are countd as one.

As far as the items being removed, there is no law requiring items to be reported on your credit report so there is no way to make them re-report them.  You probably have little recourse to try to recover any money.  All you can hold the credit company responsible for whether info is accurate.  The CB's often leave the dispute notation on credit reports and it has just been recently that banks have started requiring them closed/removed.