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How Does Rapid Rescoring Work?

Posted on June 15, 2011

Sometimes you may find yourself in a hurry to boost your credit score a few points, for example, to get a better interest rate on a loan. If you know there are credit report errors dragging your score down, but you don’t have time to wait for the dispute process to update your credit report, you may be a candidate for rapid rescoring.

How Rapid Rescoring Works

The credit bureaus offer rapid rescoring as a service to lenders and mortgage brokers. The lender can get the proof of your report error, send it to the bureaus, and have your report updated in about 48 to 72 hours. That’s much sooner than the 30-45 days it would take if you went the regular dispute route.

For rapid rescoring to work, the credit card issuer has to agree to remove the information from your report. Or, you need to have proof of the error. For example, if someone has opened an account in your name, you may have an identity theft affidavit showing that you didn’t open that account. The lender can send your affidavit to the bureaus and have your report updated.

Having high credit card balances can hurt your score and your chances at getting a loan at a good interest rate. If you have the money to pay off the balance, at least enough of it to bring the credit utilization to20%, you can pay the balance and have the lender submit a rapid rescoring request.

Rapid rescoring isn’t done as a courtesy. You could pay up to $100 for each account you have rescored. Multiple accounts would cost several thousand dollars. But, that money could mean a 1-2% reduction in a mortgage interest rate which would, in turn, save tens of thousands dollars over the life of the loan.

Rapid Rescoring and Credit Repair

Rapid rescoring isn’t necessarily a long-term credit repair strategy, but a tactic you can use if you need to get a higher credit score right away so you can qualify for a better rate on a loan. If you know you’re going to apply for a mortgage soon, it’s a good idea to pull your credit report now and work on correcting inaccurate information.

Techniques like pay for delete and goodwill deletion only work with rapid rescoring if the creditor has agreed to remove the information from your credit report and if you’ve already made payment, if necessary. It will eliminate much stress if you take care of these strategies before you walk into the mortgage lenders office. Once the credit card issuer has updated their system to remove or stop reporting the item, rapid rescoring will calculate your new score without these negative items.

Because only lenders and mortgage brokers can use rapid rescoring right now, its use is limited. You need a good credit score for more than just a good interest rate on a loan. Your credit score also affects your credit card rates, insurance premiums, and, indirectly, whether you get a job.

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