Give your credit scores a boost to get a mortgage loan by having errors corrected, balances updated or new information added to your credit files immediately through rapid re-scoring. Rapid Re-score is a method of fixing or updating credit information fast in order to help you qualify for a mortgage loan or get a better interest rate.
Despite mortgage interest rates being at an all time low, home buyers are finding it difficult to get approved for a mortgage loan and home owners cannot get approved for refinancing.
It would seem logical a 30-year fixed-rate loan below 5 percent would lure a stampede of home buyers, as well as existing home owners to take advantage of mortgage rates. But lenders and banks have made underwriting standards more stringent since the housing market went bust so consumers are running into snags trying to get approved.
Even though the housing market has shown great improvement since the housing crisis; some consumers seeking home loans or refinancing are discovering how difficult it is to qualify for a mortgage loan.
Rapid rescoring can correct errors, delete negative information or update credit card balances in as little as 72 hours.
How Rapid Rescoring Works
Rapid Rescore updates account information to Experian, Equifax and TransUnion to improve your credit scores immediately. Rapid Rescore is a service offered by independent credit agencies directly to a lender, loan officer or mortgage broker.
Credit scores can be re-analyzed and quickly corrected for the purposes of obtaining a residential or commercial real estate loan. Rapid rescoring accelerates the credit dispute process by rapidly correcting negative information and increasing credit scores immediately so consumers can qualify for a mortgage loan.
Benefits of Rapid Rescoring
Let's say your current credit score will get you a 4.00% rate on a 30-year mortgage for $300,000. After rapid rescoring, your new credit score qualifies you for a 3.50% rate. The update results in savings of $85 a month or $30,600 in interest over the life of the loan. That is a significant difference in savings with a lower mortgage rate.
Types of Credit Information to Rescore
Any negative information can be corrected as long as you have documentation to support a change. That negative information can include:
Late Payments. Let’s say you have a few credit card or loan payments reporting a 30, 60 or 90 days late. Late payments have the greatest impact on your credit score as payment history accounts for 35% of your overall credit score. If you can prove you have not paid late; that information can be corrected and your credit score immediately updated to reflect the change. You can also request a goodwill removal of late payments from your creditor. If you get an agreement in writing that information can be submitted to rapid rescore your credit files.
Collection Accounts. Another example would be new information from a collection agency. You may be able to get a collection agency to agree to delete an account in exchange for payment. If you have documentation to support that agreement, it can be submitted to a rapid scoring service and your credit scores updated immediately to reflect that change. Even if you have recently paid a collection and the status has not updated, rapid re-scoring can quickly update the paid status.
High Balance Credit Card Accounts. The most common rapid re-scoring involves paying down current account balances. Let’s say you have high credit card balances which are throwing off your credit utilization numbers. Remember, credit utilization accounts for 30% of your total credit score. FICO recently said consumers with the best credit scores use no more than 7 percent of their available credit.
Typically credit experts advise keeping your credit balances to no more than 10 percent of your available credit limit. This means if you have a credit card with a credit limit of $5000 your balance should be no more than $500.
By providing proof you have paid down a credit card balance, a lender can have your credit files rapid rescored to reflect whatever increase in credit scores you may experience.
Public Records. There may be a tax lien on your credit report showing unpaid when it has been paid. If you have documentation proving payment or a release form, that new information can be added to your credit reports in order to reflect the updated information.
Bankruptcy. It is not uncommon for consumers who filed bankruptcy to have their credit reports reflect accounts unpaid that were actually included in the bankruptcy. This can make a big difference in your credit score if an account is showing unpaid as opposed to “included in bankruptcy.”
How Credit Scores Increase
Rapid re-scoring immediately connects your credit information, your creditors and the three major credit bureaus together in order to get problems fixed immediately; something the credit dispute process cannot do in such a short time. Borrowers have experienced credit scores increase by as much as 100 points or more through the rapid re-scoring process.
Quick summary of Rapid Re-score process:
- Borrower's updated information is provided to a third-party credit agency.
- Proof of payment, proof of erroneous information, updated payment information is reviewed by the third-party credit agency.
- With the proof provided to the credit agency, it then sends the information to the 3-major credit bureaus (Experian-Transunion-Equifax) so they can immediately update your files.
- Once updated, new credit reports and scores are pulled.
Time and Cost of Rapid Rescore
Rapid rescoring is a fee-based service and varies depending on the company. The cost can be as much as $90.00 or more per trade-line, per borrower. Whatever the costs, rapid rescoring is well worth the money.
New information can be posted in as little as 3 to 5 days and your credit scores will improve immediately. You can request rapid re-scoring from your loan officer or mortgage broker for new home mortgage or refinance loans.
If you are finding it challenging to qualify for a mortgage and have documented proof to correct errors or cash to pay down high credit balances, ask your lender about rapid re-scoring, it could make the difference between approval or denial.
Rapid Rescore is an invaluable tool that lenders, loan officers and mortgage brokers have access to and can make a significant difference in the process of qualifying for a loan. Ask your lender about rapid rescoring your credit files.