WHAT LOAN OFFICERS LOOK FOR ON A CREDIT REPORT // Why You Need To Get Your Credit Pulled
HTML-код
- Опубликовано: 18 сен 2024
- Ever wonder what loan officers look for on a credit report? Or why they always want to pull your credit and tell you without pulling credit that they can't possibly know if you qualify? This video will not just explain it, it will SHOW you why and cover all aspects of what loan officers see every day when they pull credit. I go into an in depth review of a credit report and explain how uninformed decisions impact credit scores.
NMLS# 1416990
Company NMLS 2438205
My Website: www.musketeermortgage.com
Application Link: 2438205.my1003...
Licensed in the following States: KY, IN, FL, MN, AR
Please tell people about and share this video. And please subscribe. Let me know what surprised you in the comments below.
And STOP paying your rent with cash!!!
@@musketeermortgage Will do- the wow factor is seeing the joint account causing terrible affects with the credit score. The fact that it is so extended! Excellent!
@@edventure4484 Thanks!
This was invaluable information. I haven't seen anyone else on RUclips break this down like this. Please continue this.
Thanks so much! Will do.
Thank you for this break down. Sharing this video with my friend. She has student loan debt and wanted to know how it was calculated. Good Stuff!
I have a video on student loan debt. She should watch that one for sure. 🙂👍
INCREDIBLE advice! Spoke with him over the phone for some advice and he is on point!
Thanks!! :)
Very valuable information. I used this video to educate my credit repair clients before they purchase a home.
Awesome! Glad it helps.
Great information..I consolidated all of my student loans and did an IBR...my DTI went down 20 points. It helped so much..I was approved for more after this.
Good deal. There are a lot of different ways to handle student loan debt. Most of it depends on an individual's income. income based repayment plans can be pretty effective at times; for others, not so much. I wish there was a cookie cutter answer. But that's so awesome you were able to put it all together to help your DTI and increase your buying power. Well done!
This was very informative and easy to understand. Thank you!
You're welcome!
Great information breaking down the credit report.
Thanks for watching!
Very I formative video. Thank you for sharing your knowledge in free!
You're very welcome.
Thank you Shawn this video was awesome 👌
I'm glad it was helpful. Please share it with people you know who need credit help. I think this one can help a lot of people.
Here’s to financial freedom
That credit report is brutal.
Yeah, I'm very thankful I was given permission to use it. It's a great example of just about everything.
Yeah like what the helll i would just cry at this point
Very informative! Thank you!
Very welcome.
Wow. Thank you for this valuable video
Glad it was helpful!
Great video! Very informative.
Glad it was helpful!
Yeah, those medical collections can sneak up on ya, no matter how hard you're trying to stay on top of things.
Medical collections surprise so many people, especially if they have insurance. Just because a person has insurance doesn't mean medical bills are automatically taken care of. If there is a processing error, the bill can bypass insurance and people ignore the bill because they think they are covered. Or they misunderstand their coverage and refuse to pay a legitimate bill. Then before they even know it, the bill is sent to collections. Or the other big one is kids on their parent's insurance policy who are off to college. I see this one all the time. Kid goes to the doctor but doesn't tell the parents. Bill is mailed to the kid and they toss it or just ignore it thinking their parents have it covered. But the parents never see it and just like that, boom, medical collections.
@@musketeermortgage Medical collections are what forced me into Chapter 13. Anyone who says "medical debt doesn't matter", doesn't know what they're talking about.
@@atlantic_love They don't matter from a lending perspective other than the impact on your credit score. Lending guidelines ignore medical collections in regards to qualification if you still have a qualifying credit score. They do not matter to a lender. You could indeed have a million dollars in medical collections and if you still somehow have a qualifying credit score, you technically still qualify to purchase a home. Now, the likelihood of having a qualifying credit score in that case is slim to none. I know they "matter", but at the same time, I know medical collections are the easiest to remove from a credit report. I don't know your specific situation and won't get into it here. I'm sure you had a rough situation that may have required you to go into Chapter 13. But keep in mind I deal with this every single day, and for most people, medical collections, although extremely frustrating, are comparatively easy to deal with vs. other collections. Not "easy." Not insignificant. But they are in a category of their own from a lending perspective.
@@musketeermortgage A whole lot of good information there in your post, but unfortunately you weren't wearing your logic cap when you posted it. I have yet to meet a single person who has a lot of medical debt AND a "qualifying score". One does not benefit the other". Either you've lots of medical debt or a qualifying score, but not both. You sound a lot like a lender, saying a whole lot of nothing designed to get your paws on another person's credit profile.
@@atlantic_love I see. Have a good day.
That was great! I learned a lot!
Awesome! Glad to hear it.
Thank you
Welcome!
It seems with a high enough score most won't even scroll any further. The student loan in forbearance would be way better off using a IBR plan. If I remember right when it shows 0 payment then it's either 0.5% or the 1% like you said. Just depends whether it's Fannie or Freddie.
It's important even with high scores to scroll through the entire report. Every person is different, so IBR plans are better for some than others depending on the amount and their financial situation. And for conventional loans, you can actually use $0 if they have an IBR at $0. But for FHA, it's now .5%, otherwise for conventional it's 1% for Fannie and .5% for Freddie.
Yeah, credit karma numbers can be off by 45 points! If you’re paying debts on time, then you may be surprised your numbers are higher than expected.
Sometimes more. :) And I've seen the points swing both ways. Good at monitoring credit. Bad for knowing your true score.
Good info!
Thanks!
Wow thank you for sharing
My pleasure
What suprized me was that if you are on someone elses card, it still impacts your credit
Yes, ma'am. Joint credit is a blessing or a curse. But now you know. :)
Thanks, this is a great report to make your point. But, even with the lates and so on if you still have the score how does that make a difference?
HI, sorry; I'm not sure I understand the question.
@@musketeermortgage If you have the score the lates etc will stop you?
@@pearlbrown177 If your score has recovered, then the underwriting system will assess your level of risk. It it approves you, you're good to go. Many, many people have multiple lates. It just depends on how many, what kind of file, and how old. I get approvals every single day where people have lates on their credit report. It's not a show stopper, necessarily.
Geez! I bet a lot of potential buyers have reports like this! What is the likely hood if this client had a high income they would be approved? What Credit score are you seeing with the best interest rates in todays market?
HI! If they had a high income, they'd need to go through credit repair and address the collections. It would take a while, but could be done. It's a process that takes months of back and forth. With the best credit score.... and I cannot talk specific interest rates or be at risk of violating some lending laws, but hypothetically speaking, I've seen some loans in the very low 2% range. I've seen many in the mid to upper 2% range.
@@musketeermortgage I've never heard of anyone actually "repairing" credit through direct manipulation of the file. Over time, the credit will repair itself if you pay your bills on time, as in years.
Thank you 😊
Welcome!
Will using Care credit card while in the process of getting a loan impact your loan? Or will they look at it as healthcare? Will the loan officer look into why & what the procedure was for? Care Credit is mostly used for health procedures.
Using it after your credit is pulled may not impact you if you purchase and close on a home while that credit report is still valid (usually 90-120 days). But if you use it before it is pulled or if your credit has to be pulled again, it can indeed impact your credit and your debt to income ratio. Unfortunately, debt is debt and there are no special considerations as to why the debt was obtained.
@@musketeermortgage kinda figured..thank you!
Very informative video. Thanks so much! I have a question about Authorized Users on credit accounts and how it may impact the credit account holder's credit. If you have excellent credit and add an authorized user that has poor credit and a credit history that includes student loan debt, will that impact the account holder's credit rating in any way (any charges will be paid on time by the account holder)? In this video, it looked as though the owner of the credit report was an authorized user on someone else's account who was delinquent often with paying the account when it was due, which in turn appeared as late payments on this credit report. It didn't seem as though this person was the account holder. Your thoughts are appreciated.
If I am an authorized user on someone else's account and they fail to make payments and have lates on their credit report, their poor credit management now impacts me as an authorized user and I will get myself off of their account as soon as possible because they are hurting my score. Their actions impact me--for better or worse. If they are managing their credit well it can help me. If they aren't paying the credit card bills, it can hurt me. But I don't have to stay on that card. I can call and get removed as an authorized user so that trade line will drop off next reporting period. Now, if I'm the account holder and I put my kid on my account as an authorized user--he/she does not even have a card or access to my credit, they are just on my account as an authorized user--and they have their own separate card that they mismanage and have late payments, this does not impact my credit. I'm not on that card.
@@musketeermortgage - Thanks for the reply. I appreciate it.
@@tisalaw5667 You bet! Good luck! :)
Good afternoon from Boston Massachusetts
Hey, Hey! I hope all is well.
Shawn love your videos and all the help you have given me in my last 2 mortgages, hopefully I can find a house in Knoxville soon and we can do a 3rd one. I have a question about credit scores. Since I have moved "south" I have 2 store credit cards (Slumberland and Menards) with a combined limit of $15,000. I more than likely will never use these cards again. I'm going to assume like other cards that don't get used they will close these accounts. Is there a way to minimize the damage done to my credit score as my limits will have dropped quite a bit, do I try and ask someone like Visa for a credit limit increase to balance it out?
Troy!! Sending you good vibes for the house hunting!! Many companies will leave the cards open unless you request to close them. You can always ask your different cards for increases in the credit limit. Your success in raising the limit will often depend upon your usage and how good you have been making past payments. Always worth asking, though. Your logic is sound in increasing the limits of your current cards to reduce your credit utilization average.
Hey Troy how long do you suppose supposed to have tradelines on the credit card before your house
I've got 3 hard inquiries for mortgage refinancing. 2 were within 7 days of each other and the other one was a month later. All 3 still show up on my report. November and December of last year and the other was in January. I haven't tried to remove then or correct them since I don't know how to take care of it.
They will all show up, but your credit won't be impacted by all 3 separately. There is something called the federal deduplication law that prevents them from hitting you multiple times within a specified period of time. The November to December probably reflect as 2 separate hits, though. The pulls within 7 days should count as one. And none of them beat you up too bad anyway. They''ll drop off after 120 days. These inquiries aren't a big deal, to be honest.
@@musketeermortgage, my worst is my DTI, but high utilization also plays a factor on my score. Working on it though.
@@robertbidot3238 Good deal. Just keep plugging away. If you have a target in mind with the knowledge to get there, it makes it much easier to achieve. It's all just a matter of time. I wish you the best!
These people actually thought they could qualify for a house...JHC!!!! How many millions of people will not be able to buy a home for YEARS because of student loans? Many times for worthless degrees.
Most people know nothing about credit. It's going to be even tougher soon because student loan payments pick back up in September. It's going to be a tough couple of years.
Will all the derogatory accounts even if they have been paid off still hurt my client for 7 whole years?
It will depend on what it is and when it was paid off and how it is reported. The issue is the Date of Last Action or DLA. Once a collection is paid off, it updates the DLA and sometimes can look like a new late/derogatory item, so it can at times have a negative impact at first even though it now shows a zero balance. But over time it will have less and less of an impact. Plus, once it's at a zero balance, it makes it a little easier to go through credit repair and make it go away entirely since the collection agency already got their money and probably doesn't care as much about it.
This video is very helpful! Can lenders give the borrowers a copy of their credit report that they pull? Also, when would be a good time during the month to get credit pulled? I have a credit card that I pay off every month and wonder if the minimum payment on the card would be factored into my DTI even though it’s paid off each month. I look forward to your reply. Thank you!
When a lender pulls your credit, it costs them money. They pay for the credit pull through a credit vendor. So in general, most won't simply pull your credit for you and hand it over. That would cost a lot of money to provide a "free" service for credit checks because it isn't free at all. Every company is different with their policy, though. There are once a year free services for credit pulls if you just want to know your actual FICO. By law, each credit bureau has to provide one free credit report a year. But if you're doing a loan, the credit report can definitley be provided to you by your loan officer. Also, there is no specific good time to pull credit. You can't game the system. Here is a video about that: ruclips.net/video/ijV6rtmoaaQ/видео.html
Thank you for the quick reply! I’ll definitely watch the video you provided and more of your videos. 😃
Thanks
No problem
Hello,
If medical bills sent to collections are disputed, does that affect a person from getting a mortgage in the future?
It depends on the type of loan and the underwriting findings. Usually medical bills are ignored, but in some cases the findings may require you to get all collections out of dispute because it can hide your true credit score. When a collection is in dispute, it is temporarily suspended from your credit score.
How would I check my credit report? I am looking to buy in March/April. Should I pull my credit now to verify any debts or information that could be on there?
Hi! Once a year the credit bureaus will send you a free report. Ask for it now and see where you stand. :) Then you can figure out where you stand, know your debt to income ratio, and see if there is anything you need to payoff or pay down. If you are showing a low (anything 660 and below) credit score on the credit monitoring services, get your credit pulled now by a loan officer so they can give you guidance on what to do over the next few months. That pull won't impact you much anyway, so don't worry about it. But don't let your credit get pulled by anyone else. I know it's Christmas time, but avoid new debt.
@@musketeermortgage thank you very much! I am loving your videos and the advice!
@@Nmatos1213 awesome! So happy to hear. 🙂
@@musketeermortgage Any recommendations ?
@@musketeermortgage I’m a loyal subscriber now- keep up the great content!
WOW! look at all those subprime (auto) inquiries! obviously, the dealership personnel didn't know what they were doing, if they had to shotgun the application around like that. A totally inexperienced approach to securing an approval for this applicant. SMH
I see this ALL the time. If anyone says they recently bought a car, 75% of the time, this is what it looks like.
Is it better to set up a income based payment plan for student loans if you don't currently have one?
That depends on the size of your student loans. Right now, most are still deferred. You'd need to do the math to see what makes the most sense. There are a lot of plans out there for student loans, and it all depends on the student loan company/servicer, the type of student loan, your budget, etc.. I can't give you good advice on which is better. If you decide to go with an income based plan, make sure you never miss a payment. I see student loans go into collection all the time, especially when people move because they don't update their address with the student loan company and bills get missed.
Weird question, houses in my area (3 bedroom) are typically in the $20k-$90k range. And they are legitimately NICE homes but no one will touch our application due to mortgage minimums. Thoughts on moving forward?
Recommendations on where to attempt? ANY help would be very appreciated!
Yeah, many lender won't go below a $55,000 minimum because there is simply no money in them and they may literally lose money processing the deal. There are cars that are more expensive and financed on a 5 year loan. Another HUGE issue is the government restrictions. The closing costs cannot exceed a certain percentage of the loan amount, and most closing fees are relatively fixed regardless of the sales price, so mathematically, title fees alone may push closing costs over the acceptable legal threshold. So even if a lender wanted to do the loan, they couldn't. So you need to find a SMALL, local bank. Banks are allowed to hold a certain percentage of their portfolio and service them in house which provides a loophole to the government restrictions and sidestep Fannie Mae and Freddie Mac guidelines. You just need to call around to small banks and find one that will do it. If the sales price is $60,000 or more and you live in FL, VA, AL, TN, KY, IN, MN, or CO; reach out to me. In any other state, find a broker. Someone can help.
@@musketeermortgage thank you so much! I will call the local banks and ask before they run my credit :) i actually live in Pennsylvania out where the amish live lmao. So trees everywhere, nearest walmart is 45 mins out so ill need to make some calls and crazy long trips for this. Thank you for getting back to me so fast btw! We tried rocket mortgage but its a 95k minimum. Got denied 4 times last year. 😭 But this year we are getting 11k in income tax, so it'd be a higher down payment so that may help
@@Jamies_pets Do yourself a favor and avoid Rocket Mortgage. Find a local mortgage broker. They'll help you. There is actually a nationwide brokerage finder being launched today (I think). Might be perfect timing. Look up UWM and their new mortgage broker finder program.
@@musketeermortgage thank you so much for your insight! You're a life saver ill check it out in a few minutes here. Worst case i can ask HUD for help but they are difficult to contact and usually very terse. But i heard they do have programs? Hopefully they have low minimums. 🤞🤞🤞🤞
Updating. Went to the site, the closest one is 159 miles away 😭 thank you for trying though
I just looked at my Transunion credit report. It's showing I have a high balance from my credit card. I am a bit baffled by this because I've been making my payments before the closing date to have a credit utilization between 0 and 3%. This makes me wonder if my balance from my credit card is reported before the actual closing date?
HI! I made this video specifically to answer this: ruclips.net/video/ijV6rtmoaaQ/видео.html
I thought if the auto inquiries were in the same 14 days fico counts them as 1
Nope. Auto inquiries are evil. Mortgage inquiries are counted as 1, but auto inquiries blast your credit report and can hurt pretty bad.
To buy a house. Do you need tax returns. I'm working on mine fr last 7 years. Can I not buy a house without tax returns? Is there another way around
It depends on the type of loan, but you can often buy a home with just the W2s. Unless you are self-employed or going USDA. Then you have to show tax returns.
Credit repot jacked up
But with the right knowledge can be fixed over time.
I actually have a payoff for deletion and here it is years later and still on my Credit report. I have disputed it time and time again. What do I do with this car company.
Car companies usually won't do a pay for deletion, only medical collections. If you've tried to dispute it on your own, you can ask a credit repair company if they can help. They should tell you what they can do in a free consulation. Just do NOT us Lexington Law. ANy other credit repair company will probably help. I like My Credit Guy out of AZ. They are honest brokers from my experience.
I have 3 or 4 collections my credit report from experiam from hospital bills some drop off and some come on and i haven't neem in the hospital two are the same exact amount 658.62 and it's from over 9 years ago. I don't even know what they are from my insurance covered my bills and I told the collections people that on the one's that called me .can any of those effect my credit? Im not paying for bills that i don't even know what they are from. They said from doctors i never even heard of and some tests or something i don't even know what were.
You have to be super careful with medical bills because if you ignore them or refuse to pay them, the hospitals will simply send it to collections and then they write off the medical bills from their taxes and wash their hands of you. Meanwhile, you're stuck with the collection and have to fight it. I see this ALL the time where insurance is supposed to pay but they don't and the medical bills go to collections. You need to actively fight those. If you just ignore them, they will simply go to collections and then you have to fight to get them off. Medical bills are the "easiest" to dispute , though. If they are already in collections, dispute them and make them prove they are yours with some kind of documentation that has your signature.
@@musketeermortgage ok thanks! There was no signature from me on any of them I never even saw thre original bills before collections, I see them on my credit but it doesn't say it's effecting my credit score so I was wondering if it dose or do lenders even care about them?
@@magiccheeseball Medical bills are the only ones we don't care about, but I promise they are impacting your score in some way. Weird that there is something from over 9 years ago, though. At any rate, it might only have a small impact from that long ago, but you could try to dispute them first if they are that old. But again, if you have a qualifying score, we don't care about the medical bill itself.
@@musketeermortgage ok thanks! Yeah that one Bill was strange it was 2 bills for the same amount then after 7 years i thought it would go off and it looks like they refreshed it or reposted to the credit beuro or something it seems sketchy,, some bill collector companies probably aren't the best type of people and probably do anything to make a buck
Her credit report jacked...that persons
It can happen. Now it's a matter of repairing the credit and managing it correctly.
But why does those old bills matter from 2017 especially if paid?
Simply because they were late. If a person doesn't pay their bills on time it is an indicator that they can't manage their money or debt properly. The older the late payment, the less damage it does to the credit score over time. So you can indeed recover if you've been making your payments ever since. Credit has a 7 year cycle, and the older the credit blemish is, the less damage it does, so it doesn't punish you the same amount over time. New lates can crush your credit 50-100 points. Old lates might have little impact depending on how long ago.
Whats a reliable way to check credit from home?
Once a year you can get a free credit report fomr each of the bureaus.
People concern with credit pull. 8 out 10 they have bad credit.
If they have someone who knows how to analyze credit pull it then LISTEN to how to fix it, those with bad credit can be put on the path to getting it cleaned up. It just takes time, effort, and knowledge.
How far back do lender's look at credit reports???
A credit report has data going back 7-10 years. It's not how far back a lender looks, it's knowing that what goes on your credit report is on there for 7-10 years.
@musketeermortgage I'm planning on buying a home in a few years so I'm preparing now,I know by the time I'm ready to buy I'll have a nice savings and all negative items on credit report will be deleted, I'll make sure my credit reports are the cleanest the could possibly be a long with clean bank statements thank you
I had a loan denied one time because I had an open dispute on my credit report. Is this accurate?
When you dispute an item it essentially masks it from your score. So depending on WHAT the item is in dispute and the type of loan, sometimes you have to get it out of dispute to do the loan. Once out of dispute, it could negatively impact your score, so it's possible that is what happened. Hopefully your loan officer told you to do that before you got a contract.
What about Lates that are paid off how are they going to effect?
Lates that are paid off still show as lates. This is why I say it's better to eat mac and cheese than to miss a payment. There is no such thing as a little late. It does massive damage that lingers. It is imperative to pay the minimum on time.
@@musketeermortgage So look at the report on this video what advice did you give as far as how long it would take to get a mortgage?
@@pearlbrown177 The timeline depends on each individual person and their credit report. This report requires credit repair and time. Impossible for me to give an exact timeline. Every situation is different. Some take 3-6 months. Some take longer. The key is to stay focused and not give up. Credit can be repaired, but people take years to screw up their credit, then want it fixed in 30 days. That's not going to happen. Once you get committed to fix credit, it's a marathon, not a sprint. And it will probably cost money to get it fixed.
How does old student loan late pays affect your home buying power?
A late on any debt negatively impacts your credit score. Enough lates and your score will drop too low. If a student loan is in collections, that will prevent a buyer from qualifying because you can't get a government insured loan (FHA, USDA, VA) while another government loan is in collection.
Shawn C Neely How do you recover from old negative debt? I understand paying on time, but what if the late pays is 4 years old and the account is clo
Closed. I have no student loans in collections, because they are all in deferment. The old closed accounts have lates. Is it possible to have the closed accounts removed since they were transferred and consolidated?
@@critiquemydecor6801 You can try to have it removed because it's a zero balance. Credit repair companies do that all the time. Not sure if you can do it on your own - not something I've personally researched as far as the mechanics. I'm sure there is a way because I know it's done. Otherwise, they drop off in 7 years. The older they are, the less impact they have on your score.
Shawn C Neely okay. I will try on my on. I saw a RUclips video on it. Also, I just called some loan officers. The said if it’s over a year old/closed, don’t worry about it.
can loan officer see what i spend my credit card money on every month?
A loan officer only sees the last balance reported when credit is pulled. It doesn't update automatically. It has to be repulled each time, and that would not be a good idea. LOL
@@musketeermortgage so they only see the balance and not the individual items that made up of the balance correct?
@@winkawak Correct. The credit bureaus do not have access to that level of information.
Ewww credit one no Bueno already
Learning about how credit works can prevent a lot of the issues people have that are usually just caused by lack of knowledge.
How does a loan officer look at late payments from 6 years ago?
Those are probably a non-issue from 6 years ago if you've been caught up ever since. If your credit score is good, you'll most likely be fine. The automatic underwriting system will determine layered risk, so the only way to know for sure is to apply and have your scenario run through the system.