Consumers often have concerns about the score impact hard inquiries have on our credit. Here are three quick tips that will help you distill it down for you as you shop for a mortgage..
1. Inquiry score impact typically ranges between 5-12 points, but there is no specific number assigned, it’s based on the overall report profile, so don’t even try to guess. Just consider that the stronger the profile, the less the impact.
2. Hard inquiries only impact your scores for 12 months, that’s it.
3. Inquiries remain on reports for 2 years, then are removed.
What does this mean for the borrower that is looking for a home and has a credit score that is borderline to being between credit rated categories (ie. good and fair; excellent and very good; etc.)? Often having your credit pulled can drop your score from one category to a lower one and this a fear of many borrowers as they shop for a home. It is good to know that as you shop for a home mortgage that it is taken into consideration from the first credit pull for the next 30 days of shopping, that your credit score is not affected if your credit is repulled for the same reason as was the initial pull of a mortgage inquiry. Hopefully that initial inquiry credit pull did not bring your score below the point of a categorical change and you are still in the position of being able to finance with the same credit grade as originally started with.