Can I provide you with a free credit report online rather than pay for one?
By law all mortgage products have to be underwritten using EXACTLY the same guidelines because mortgage backed securities are saleable financial instruments. And, just as you would want to know that the next refrigerator you buy complies to the same safety standards as every other one on the market,so do the buyers of mortgage backed securities need to know that they are underwritten to exactly the same standards as every other federally insured mortgage in the United States.
The free "credit reports" available online are not real credit reports and never could be because the three credit bureau's keep their scoring algorithms top secret. All those services are able to do is access your current and past credit situation and estimate your credit scores. For this reason there is little consistency and they can't be used for formal mortgage applications or even application evaluations (for example if you ask a mortgage broker to pre-approve you to buy a home).
How much "real" credit reports cost?
As we are all painfully aware the cost of most things have risen dramatically over the last few years and credit reports even more so. Just a few short years ago they were $30. Now they are closer to $100!
Does that mean it will cost me $100 to get mortgage pre-approved?
Not necessarily. If you formally apply through your mortgage broker to purchase or refinance a home - meaning not only does your mortgage broker evaluate your documents but they also process an actual application through a lender - then you would need a "Tri-Merge" credit report which shows all 3 credit scores. There is no way around this if you formally apply. You would only formally apply if you are formally in contract to buy a home or have given your mortgage broker the green light for a refinance application.
On the flip side - if you are simply shopping for a home purchase or refinance loan and you would like me to internally pre-approve you and provide you with a pre-approval letter should know that there is a second option known - "Soft Pull" credit reports.
Soft Pull reports provide only scores from two bureau's. However they do show your broker all your current and past creditor details and provide enough information for them to determine your mortgage eligibility.
That said you have three options:
Option 1: You pay around $100 on a credit card for a tri-merge credit report. Lenders will accept them for several months
Option 2: You pay around $50 for a two-bureau report. This will show your broker all your current past creditor and TWO credit scores and will be enough for them to pre-approve you. HOWEVER, if in the near future wish your broker to put in a formal mortgage application to one of their lenders you would then have to then pay an ADDITIONAL $100 because the two-bureau reports are not "upgradeable" to a tri-merge report
Option 3: You pay nothing for a soft-pull report. I will pay for it on my credit card. When you e-sign your authorization for me to pull your credit report you'll be provided with a credit card authorization form and you can optionally fill out the form for an approximate $50 fee. But I will leave the decision up to you and in no way, will choosing to avoid that fee have any influence on how I work with you. If you choose not to pay and we never do business together I will not ask you to repay me.
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