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Credit Score sustaining multiple Mortgage applications

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I currently have 3 mortgages going through and I have noticed my credit score take a knock as they each do their hard searches. 

I realise you should try to space out applications for credit but my question is how does your credit score not self implode if you want to use mortgages to expand your portfolio quickly? if you were to buy a couple of properties a month for instance. It's clearly possible because people have done it. 

Also how many hard searches is realistic for a single mortgage company to make? One of the three I am using has made FOUR hard searches over the course of the initial application to it finally being granted. That seems a bit excessive and it keeps resetting how long it has been since the last search on my credit profile. It is definitely hard searches instead of soft searches. Every other mortgage lender makes a single hard search. 

Thanks in advance to anyone who can shed any light on this.

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Well - Credit Scores are a dumb indicator mainly for us as consumers to use. 

Lenders implement there own Credit checking facilities and its more about the substance rather than an arbitary number. At least nowerdays it's getting more that way.

Lets say you have a BTL Purchase going on.

  • Scenario 1) When they check you have had 11 BTL Remortgages that month, they will not bothered about the multiple hits. 
  • Scenario 2) When they check you have had 11 BTL Remortgages releaseing equity that month. They will ask some questions and be more enquisative about ongoing portfolio affordability.
  • Scenario 3) When they check they see 3/4 BTL Purchases that month. They will be rather worried on First Time Landlords with decreaseing concern for larger landlords, with experiance at scale.

You will often here people say "lender decliend due to credit score". It's just more simple for credit suppliers, than explaining the detail and their internal process of looking at the overall credit picture and what it is telling them about you.


:wub: Get Mortgage Advice from my Team at Bespoke Finance on 08009202001 or email hello@bespokefinance.info 
:ph34r: 
Please don't take my messages on Property Hub as Personal Financial Advice, just a rambling guy passing time on a Coffee Break.
 

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Generally, there will only be one hard credit search per lender. Although if you are planning to make multiple purchases each month, as an example, then there are a couple of options for you to help reduce the amount of credit checks being carried out...

•Approach a lender who will accept multiple properties within one application

•Utilise a lender with a forward funding facility (The lender will underwrite one application and will then provide you with a pre-agreed facility of X amount, which you can then access as and when you find suitable properties)

I hope this is helpful and please do let me know if you have any questions.

Best regards

Nathan Cole 

 

 


Nathan Cole CII (MP)

Mortgage Consultant at Private Finance

Office: +44 (0)1743 211 855

Email: nathan.cole@privatefinance.co.uk

Website: www.privatefinance.co.uk

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