Paying for credit score before attempting mortgage prequal-Good idea? & mortgage interest questions!

In My Humble Opinion
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Don’t bother paying for a credit score. There is more than one credit score. The one you get if you pay for it is called an “educational score.” It isn’t calculated the same way that the mortgage score is. The educational score tends to be higher. The mortgage score tends to use more restrictive scoring so it is lower. No lender or creditor uses the educational score.

(If anyone advises you to attempt to raise your credit score by disputing debts that you actually owe, RUN. THIS WILL NOT WORK!)

Each of the three main depositories (Equifax, TransUnion, Experian) calculate scores a little differently - that’s why the scores they report to the lender are all different. And not all lenders use the same scoring model. The score you get will not do you any good. It’s a waste of your money.

Your REPORT, on the other hand, will tell you what you need to know about your accounts and their status. That’s worth pulling.

Many first time buyers take advantage of FHA financing, which requires a 3 1/2 % downpayment and generally has more lenient credit standards. Many states and some cities offer downpayment assistance. Try googling the name of your state along with “housing finance authority” or “down payment assistance” and see what comes up.

Keep in mind that different lenders offer different interest rates. There isn’t one interest rate. Also, pay attention to the terms and fees. Some lenders will offer you a “lower” interest rate and charge you higher fees or discount points (that’s how they make up the difference in the “lower” rate.) You have to consider the TOTAL costs of the loan.

Basically if you have made good use of your credit, paid bills on time, and not opened too many accounts too recently, then you should already have a pretty good idea of what’s on your credit report.

If you are going to shop around among lenders, make sure you do it within approximately a two week period. The depositories expect you to shop around and have your score pulled a lot while you’re shopping, so it only gets counted as one pull during that time period. If you wait and have it pulled, say, tomorrow, then have it pulled again by a different lender three weeks later, than by another lender three weeks after that, that will count as three inquiries. Each inquiry drops your score by a few points. If you do all your loan shopping at once, it counts as one pull against your score.

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What do you mean by “actual” people/families? And what aspect of the deduction, exactly, are you wondering about?

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Not always true. For example debts that are beyond seven years can certainly be disputed as well as those very small.

Correct. Get the report.

Except for all the false stuff that on your credit report, like the accounts of your Father, someone with a ssn like yours but one digit off that input it wrong, some illegal that is using your ssn, and so forth.

The 2012 study found, among other things, that one in five consumers had an error that was corrected by a credit reporting agency (CRA) after it was disputed on at least one of their three credit reports. The study also found that about 20 percent of consumers who identified errors on one of their three major credit reports experienced an increase in their credit score that resulted in a decrease in their credit risk tier, making them more likely to be offered a lower auto loan interest rate.

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DrDeth, I said nothing about not disputing INCORRECT information on the credit report.

But don’t believe that you can just dispute anything on your credit report and it will go away. It won’t. Rachellelogram is wanting to buy a house. She asked about paying for a credit score.

I gave her correct advice. Don’t bother paying for the score. I also gave her other correct advice. You are free to disagree with me.

As far as credit report disputes go, most lenders that I know (and I know a LOT of them) will not approve your mortgage application with current disputes on the credit report. So if anyone is wanting to buy a house and has “very small” items on their report, just know that the dispute process is going to require approximately three months to go through the process and update the credit report. And if the debts are correct, and they are confirmed, then you’ve just wasted months getting them confirmed. It’s not something I would do. You don’t have to worry about very old items on the report unless that is the only thing on the credit report. With the exception of bankruptcies, foreclosures, liens, judgments, and defaults on government debts, they won’t look back that far, again unless that is the only thing on the report.

The bottom line is that each lender you apply with will pull your credit score from their source. They won’t consider any other scores from any other source. You won’t know if a lender will approve you until you apply.

But in the meantime, get your report. See if you have collections, liens, or judgments. See if you have paid any accounts late during the prior 12 months. If you have paid late, you’ll need to pay them on time for 12 months in order to be approved. If you rent, it is important that you have paid your rent on time for the prior 12 months.

The United Way offers a matching funds program that you can use toward buying your first house or can even use toward education expenses. Contact your local United Way and ask them about the matching funds program. You save and they will match it, usually $2 for every $1 you save. (Education funds are matched at, I believe, $4 for every $1.) They will tell you the requirements, terms and time requirements.

Get your credit report first., ** Rachellelogram.** That’s where you start.

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What I disagreed with is “Basically if you have made good use of your credit, paid bills on time, and not opened too many accounts too recently, then you should already have a pretty good idea of what’s on your credit report.”

since far too many credit reports contain a significant error(s). Especially if you have never checked yours, as the Op seems to have indicated.