Q: We went to apply for a mortgage and were surprised when our lender told us we had only a 640 credit score. This did not seem right to us since we pay our bills on time and don’t have big credit balances. When we checked our credit report, we noticed there was a very glaring error on it. It showed that one of our accounts was still open with a large balance which was overdue. We paid off this balance almost two months ago, but I guess it has not shown up yet on our history. We have a good down payment, good income, steady jobs and a house that we want to make an offer on. Is there some way we can fix our credit score without going through the credit bureau’s process which I am afraid is going to take a long time? We want to move fast and try to get this house.
A: You are right: Fixing errors directly with each of the three main credit bureaus (Equifax, TransUnion and Experion) can take weeks. But you can circumvent this process by going directly to your lender, providing him/her all your documentation that shows the still open credit account and balance on your credit report is an error, and ask the lender to re-score you. Your lender’s credit report vendor will verify your documentation with the creditor and provide the corrected information to the credit bureau. The updated information should show up quickly on your file, and allow the credit report vendor to pull a more accurate and up-to-date report and credit score for your lender. Depending on the severity of the error, your score should go up quite a bit in just a few days.
Anytime you believe your credit score is in error and you have the documents to prove it, you can request a re-score from your lender. But a re-score is not for everyone. If the negative information depressing your credit score is accurate, a re-score is not going to help you. There is also the expense of a re-score. Each of the credit bureaus will charge a fee to correct each erroneous account. If you have several accounts to correct, this can add up. Your lender will have to foot the bill for a re-score, although this charge will almost assuredly be passed onto you at settlement.
A credit re-score is not for everyone, but if you have the documentation and the money, a re-score might lift a poor credit score higher and help you get a better loan and interest rate.
Linda Goodspeed is a longtime real estate writer and author of "In and Out of Darkness." Email her at email@example.com.