Sometimes, the smallest difference in your credit score can mean receiving better terms on a large loan, such as a mortgage. If you’re just a few points shy of receiving the more advantageous terms that can potentially save you thousands of dollars, you may be considering putting off buying that house until your credit score improves a little. However, there is another option, called a rapid rescore.
What Is Rapid Rescoring?
The main goal of rapid rescoring is to improve your credit score. Lenders do this by updating your account quickly. This is usually done when you apply for a loan, such as a housing loan.
This process can update recent credit repayments, fix any errors, remove negative aspects on your credit profile and reduce your overall loan balances. For example, if you’ve just paid off a credit card your lender can update that information in a few days rather than waiting for credit bureaus to receive and update that information.
This is called rapid rescoring because it allows your credit score to be updated in a faster timeframe than normal. The lender has access to third parties and credit bureaus to help expedite this process and update the information. Usually, credit bureaus can take weeks if not months to investigate discrepancies you find and then fix them. However, your lender can do this in a matter of days and speed up the overall process.
In the end, you may end up with a better credit score, even if by only a few points. However, those few points just may be what you need to receive a better loan agreement and save money.
What Are the Limitations?
While a rapid rescore sounds like the solution to your problems, there are some things this process cannot do. Let’s take a look at those limitations:
- It’s not for everyone: This isn’t the best choice for every individual, which is why a thorough discussion with your lender is essential. In some cases, a rapid rescore can actually lower a person’s score, which is the opposite of what you want. To see if it’s right for you, speak with your lender about the possibilities and risks associated with the process.
- It is for small changes: Don’t expect a miracle with rapid rescoring. Generally speaking, this works for small changes, usually around 10-20 points as the maximum. However, fixing a large error can dramatically affect your score, such as an erroneous statement of bankruptcy.
- It doesn’t repair your credit: This process should not be used to fix your credit. It does, however, act as a credit booster. You can update your information quickly but not fix your overall score. Remember, this is a small boost, not a large one.
- It doesn’t remove true statements: You cannot have information removed from your credit report simply because you don’t like it. However, if there are errors on your report, you can have those removed. For example, if your report states that you defaulted on a loan but you have not, that is something your lender can have removed and updated for you.
How Does The Process Work?
You need to work with a lender for a rapid rescore, such as your mortgage broker. You provide them with all the pertinent information and they send it to the credit bureaus to speed up the process.
Generally speaking, this can take up to a week for the process to be complete. However, that timeframe also depends on how fast you provide the information and how much work you need to do to hand that information over to your lender. For example, you may need to pay off a credit card before your lender can update that information. If you don’t have the means to do that immediately, the process may take longer.
It is also a free service. In fact, federal laws prohibit your lender from charging you for a rapid rescore.
Give Your Credit a Slight Boost
If you’re worried about your credit score or want to improve it quickly by a small amount, you may want to consider a rapid rescore. Keep in mind that this isn’t a fix-it for bad credit, but it can help you marginally improve your score by updating your information through a lender. If you need more help improving your credit, contact Coast Tradelines to learn how you can do that.