Credit inquiries and your credit score

Credit inquiries reduce your credit score because research has shown a link between multiple credit inquiries and increase in defaults. It doesn’t seem fair, does it? How can you shop for a mortgage under those circumstances? Here’s an answer: inquiries made within a thirty day period count as one inquiry. So once the first mortgage broker orders your credit score, you have 30 days for other mortgage brokers to check your credit score without having their inquiries count against you.

Of course, from your real estate agent’s point of view, 30 days is a long time, and if you stretch your mortgage shopping for that long you may not close on your new house in time. You could lose the house of your dreams! In addition, a real estate contract includes a Third Party Financing Addendum, which requires you to apply for financing “promptly” and “make every reasonable effort to obtain” financing approval. Notice of denial MUST be given to the seller within the number of days specified in the contract. So shop around for the best interest rate, but do it within 7 to 10 days just to be sure.