If you have applied to be pre-approved for a mortgage loan but were a few points shy of the minimum credit score, don’t despair yet. Some mortgage lenders have at their disposal the rapid rescore. Instead of waiting 3-4 months for your score to make its way to where it needs to be, you can get the same results in a matter of only 2-3 business days if you have some cash at your disposal.
The Rapid Rescore Process
- Your mortgage advisor runs a credit simulator to see what immediate actions can be taken to improve your credit score by a desired number of points. An example might be paying down a balance on your credit card so that it’s below 50% or 30% of the credit limit.
- If actions were identified that you are able to complete, you would take the steps suggested and provide documentation to the mortgage advisor from your creditors. They will typically require a letter with your name, the account number, and the new balance on the card.
- You mortgage advisor will then submit these letters to the credit bureaus on your behalf. Once the information has been update, they will repull your credit report, and, hopefully, there will be good news! I’ve seen clients’ scores raised between 20 and 60 points after a rapid rescore.
Important to Note:
- Not all mortgage lenders have the ability to do a rapid rescore.
- A rapid rescore can also be used to raise your score to the next credit tier so that you qualify for a better interest rate.
- Rapid rescores can be expensive. Sometimes the mortgage company will pay for it and sometimes they will pass the cost along to the borrower. Make sure to ask this question of your mortgage company before a rapid rescore is completed. You don’t want that surprise showing up on the HUD.
Start Early To Avoid a Rapid Rescore
Since most rapid rescores involve paying down balances on revolving credit , start paying down these balances 4-6 months out from getting pre-approved for a mortgage. Begin with paying them all down below 50% of their limits and then move to paying them all down below 30% of their limits. Here are all of my tips for preparing your finances to buy a home.
If you have any questions about a rapid rescore or getting pre-approved to buy a home in Virginia, please don’t hesitate to contact me. I am a licensed loan officer in Virginia with First Home Mortgage. Also, if you are looking for the best Richmond VA real estate agent, I am happy to recommend one to you based on your search radius.