Rapid Rescore

Using Rapid Rescore To Qualify For a Mortgage

Gustan Cho Associates are mortgage brokers licensed in 48 states

This guide covers using a rapid rescore to qualify for a mortgage. Creditors update consumer’s credit once a month. For example, borrowers who need to pay down their credit card balance for credit scores to go up or due to having higher debt-to-income ratios should pay it on February 7th.

Rapid rescoring is a process used in the mortgage industry to quickly improve a borrower’s credit score to help them qualify for a better mortgage rate or loan approval. It’s not a service that borrowers can directly request themselves; the lender must initiate it.

The credit card company will report a new balance after the credit cards are paid down by the end of February. The credit report will not reflect it until the first week of March. Updating a credit report normally takes one month or more. You can get an updated credit report in a matter of days through Credit Rapid Rescore.

Who Orders Rapid Rescore

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Credit rapid rescore is used by most mortgage brokers to update or raise a lower credit score in a matter of 3 to 5 business days. Rapid Rescore is also used to correct errors on a credit report. A credit rescore client’s updated information is provided to a third-party credit agency, Proof of payment and proof of erroneous information data, and the credit agency then, in turn, reviews the information. With the proof provided, correct the three credit reporting agencies:

  • Transunion
  • Experian
  • Equifax

The first step in the rapid rescore process is for the lender to identify a potential benefit to improving the borrower’s credit score. This typically happens when the borrower’s credit report contains errors or there are inaccuracies or outdated information affecting their credit score.

Reason For Rapid Rescore: Case Scenarios

Borrowers applying for a mortgage but have inaccuracies on credit reports may not have one to three months to wait to dispute inaccuracies with the three credit reporting agencies. For example, here is a case scenario. If those who filed bankruptcy three years ago but the credit reporting agencies posted bankruptcy only a year ago. This error will hinder borrowers from qualifying for a mortgage due to the inaccurate information listed on the credit report.

In a case like this, the credit report must reflect the three-year bankruptcy seasoning even before the borrower can qualify for an FHA loan. The Automated Underwriting System will not render an approve/eligible because AUS only goes what is stated on the credit report.

Need to get bankruptcy discharge paperwork from the mortgage lender, and the loan officer will request a rapid rescore from a third-party credit company. The third-party credit company will, in turn, notify the three credit reporting agencies. Provide them with the bankruptcy discharge paperwork and update the correct date of bankruptcy, which is three years old, instead of the inaccurate one-year-ago reporting date. All this is done in a matter of 3 to 5 business days instead of months. Once the lender gets the correct information updated on the credit report, they can then proceed with the processing of the mortgage application.

Using Rapid Rescore To Update Balance on Credit Cards

What does the balance on credit cards meanAnother case scenario. Say the borrower has three $1,000 credit limit credit cards, and the balance on all those cards is $900. High-balance credit cards will lower scores substantially. Pay off credit cards to get a higher credit score to qualify for a mortgage or get the best available mortgage rates. What you need to do to get a quick fix is for the loan officer to do a rapid rescore. Pay off all three credit cards and provide a loan officer with proof of payment.

The loan officer will provide proof of payment and a zero balance statement to the third-party credit company. The third-party credit company will contact all three credit reporting agencies.

The credit bureaus will reflect an updated zero balance on the credit report in a matter of 3 to 5 days. By doing a credit rescore, borrowers do not have to wait over a month for an updated credit report to reflect a zero balance. A rapid rescore is done in a matter of 3 to 5 business days.

Gather Documentation Required For Rapid Rescore

The borrower must provide the lender with documentation that supports the case for a credit score improvement. This could include proof of paid-off debts, updated account information, or other relevant documents that can help correct the inaccuracies or improve the credit report.

Lender Initiates the Rapid Rescore Process

The lender, after reviewing the documentation and identifying the potential for score improvement, contacts a rapid rescore company or service. These companies have established relationships with the major credit bureaus (Experian, Equifax, and TransUnion) and can help expedite the process. The rapid rescore company will work with the credit bureaus to verify the accuracy of the information provided by the borrower. If errors are found, the credit bureaus can update the credit report within a few days rather than the 30-day dispute process. This can result in an immediate improvement in the credit score.

Lender Reevaluates the Loan Application After Rescore

Once the credit report is updated with the corrected information, the lender can reevaluate the borrower’s loan application with the improved credit score. This can lead to better mortgage terms, lower interest rates, or even loan approval if the previous credit score was the primary barrier.

It’s important to note that rapid rescoring is not a guaranteed way to secure mortgage approval or better terms. It can only help if there are errors or outdated information on your credit report that can be corrected quickly.

Also, borrowers should be aware that there may be fees associated with rapid rescoring, and the process may not be available to all lenders. Before pursuing rapid rescoring, it’s a good idea for borrowers to improve their credit scores over time through responsible financial behavior, such as paying bills on time, reducing debt, and managing credit accounts wisely. This can lead to a more favorable mortgage application without rapid rescoring.

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