Mortgage shoppers hear many strange tales about the home loan-shopping process. Here are 6 common myths about shopping for a mortgage and the facts you should know:
Myth: Shopping for a mortgage loan will hurt your credit score.
Fact: Credit scoring companies know most people want to shop around for a mortgage or car loan. That’s why their formulas allow a window of time during which multiple inquiries about your credit will be counted as only one inquiry. If you stay within that window, you don’t have to worry about shopping for a loan from multiple lenders. (For more information, read the LendingTree article Credit Inquiry FAQ or “Credit Inquiries” on myFico.com.)
Myth: All lenders sell your personal information to telemarketers.
Fact: When you apply for a loan and the lender checks your credit history, the credit reporting company may sell your name and telephone number to other lenders. These names and telephone numbers are known as “trigger leads.”
If you’re shopping for a loan and don’t want to become a trigger lead, you can submit a form online at OptOutPrescreen.com. This will help to keep your information private and ensure the credit bureaus won’t sell your information as a trigger lead.
Myth: Everyone can qualify for the low interest rates advertised on television.