Forums / Getting Technical / Finance / Too many credit Enquiries

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  • Profile photo of SebastianSebastian
    Member
    @sebastian
    Join Date: 2003
    Post Count: 55

    I understand that mortgage insurers look at the number of credit enquiries on your credit file in assessing your application.

    Why do they look at these? They do not state whether you got the loan or not. How can they take these into consideration on this basis?

    Do the credit enquiries fall of after 5 years as per other data on your credit file. Can you remove them any other way?

    Being shot down for too many credit enquiries is a bit rough, esp if it will effect you for some time to come, possibly 5 years, not being able to get LMI! Having to pay 20% deposit!!

    Thanks for your input!

    Sebastian

    Profile photo of kay henrykay henry
    Member
    @kay-henry
    Join Date: 2003
    Post Count: 2,737

    Sebastian,

    I am not convinced that having “too many” credit inquiries on your record will affect your borrowing capacity or LMI eligibility. I checked my credit record last week, and was told by my Bank Manager that the lenders (including LMI lenders) only have a problem if there are problems with credit- not if you have applied for it. I think it’s probably best notto apply for credit unless you are going to go through with it though, because every reference remains on it. Not sure how long (if ever) the inquiries fall off it, but mine have been on there for longer than 5 years.

    kay henry

    Profile photo of Stuart WemyssStuart Wemyss
    Member
    @stuart-wemyss
    Join Date: 2003
    Post Count: 598

    Hi Seb

    The problems arise where someone has a lot of credit enquiries within a short amount of time. It raises the mortgage insurers/lenders attention and could be due to a borrower “shopping” an application around (e.g. getting declined and going to the next lender).

    If you can explain the enquiries (e.g. pre-approval, purchase, etc) then they don’t normally cause any problems.

    They normally on focus on the last 6 months only (for enquiries that is).

    Cheers

    Stu

    Profile photo of Mobile MortgageMobile Mortgage
    Member
    @mobile-mortgage
    Join Date: 2003
    Post Count: 913

    Hi Kay,
    Credit inquiries should be removed from your credit file after a Five year period,
    It may be worthwhile contacting Baycorp incase there has been an oversight regarding your file,

    Baycorp Advantage
    Phone 0294646000
    http://www.mycreditfile.com.au

    Regards
    Steven
    Mortgage Broker

    [email protected]
    http://www.mobilemortgagemarket.com.au
    Ph:1800 820 500
    VICTORIA

    PLEASE note comments made should NOT be taken as specific taxation, financial, legal or investment advice. Please seek professional, specific advice.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,173

    I’ve had two of my loans rejected soley on the basis of the number of enquiries on my CRAA. However, they were both approved after explaining them to the mortgage insurer. You should try to keep the number of enquries to a minimum where possible, but they are not such a bad thing.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of TeacherK6TeacherK6
    Member
    @teacherk6
    Join Date: 2003
    Post Count: 164

    Hey kay :)

    Just a question, how does one check their own credit history? im now curious to see what mine says about my shady past [cigar] lol

    thanx :)

    Jason

    Profile photo of Mobile MortgageMobile Mortgage
    Member
    @mobile-mortgage
    Join Date: 2003
    Post Count: 913

    Baycorp Advantage
    Phone 0294646000
    http://www.mycreditfile.com.au

    Regards
    Steven
    Mortgage Broker

    [email protected]
    http://www.mobilemortgagemarket.com.au
    Ph:1800 820 500
    VICTORIA

    PLEASE note comments made should NOT be taken as specific taxation, financial, legal or investment advice. Please seek professional, specific advice.

    Profile photo of SebastianSebastian
    Member
    @sebastian
    Join Date: 2003
    Post Count: 55

    Thanks for the replies people.

    I had ordered my CRAA file from Baycorp some time ago and it came up squeeky clean.

    I’m trying to learn as much as I can about finance and the processes involved, after a recent decline I want to make sure that my financial position and how banks etc view my situation is the best I can get it so that I don’t have to face another rejection!!

    Stu,

    Hi!! So I gather from our past discussions and what you have posted here, when it comes to events in your financial history, lenders only ever look at the last 6 months. Am I correct in saying this?

    Terry,

    When dealing with Mortgage insurers, who, use their own criteria which you must meet, is there a certain level of flexibility in terms of explaining your situation that may sway them? Or is it rock solid, you must fit in their formula or no finance?

    Thanks guys

    Sebastian

    Profile photo of Stuart WemyssStuart Wemyss
    Member
    @stuart-wemyss
    Join Date: 2003
    Post Count: 598
    Stu,

    Hi!! So I gather from our past discussions and what you have posted here, when it comes to events in your financial history, lenders only ever look at the last 6 months. Am I correct in saying this?

    In terms of credit enquiries, yes the past 6 months is the most relevant to the lenders.

    Cheers

    Stu

    Profile photo of kay henrykay henry
    Member
    @kay-henry
    Join Date: 2003
    Post Count: 2,737

    Jason,

    My Bank Managet had mine sitting in front of her- she just did a quick check when I signed for a mortgage last week. So I looked at it at her desk. I’d never seen one before :) But as the others here have said, you can get it yourself from Baycorp.

    kay henry

    Profile photo of AceyduceyAceyducey
    Participant
    @aceyducey
    Join Date: 2003
    Post Count: 651

    We check our CRAA annually – more frequently when we have a lot of loans underway at the same time (we like to refinance 4 or 5 places at the same time – it’s a lot of work, but gets it over & done with faster).

    Basically it’s as Stuart says, though I’d be even so bold as to say the last year.

    And it’s well worth getting your CRAA if you haven’t for several years & checking what’s on it. Mistakes do happen & it can be important to correct any mistakes on your CRAA before you’re sitting in front of your Bank Manager hoping there’s nothing wrong.

    And be careful about taking advice on the relevance of CRAA from people who’ve not seen theirs BEFORE meeting the bank manager.

    Cheers,

    Aceyducey

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,173

    Sebastian

    LMI are sometimes slightly flexible, but not very often!

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

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