Credit Disputes Can Delay Your Mortgage Application -- Even If They're Legitimate!

I often consult with potential home buyers who eventually tell me about their credit disputes.  Old credit disputes with their dentist, or their cable company or a hospital that they have never resolved.    Sometimes their disputes are warranted.  Sometimes the dispute is just a miss communication problem.  Regardless, these credit disputes must be cleaned up and dismissed before potential buyers can realize their dream of home ownership.  Sometimes people tell me that they are working with a so-called "credit repair" company who is helping them to restore their credit.  Bottom line is that banks and mortgage companies will not process your loan until all your credit issues are resolved.  

Recently Judy Jones, Vice President of Metro Brokers Financial addressed this issue with a blog.  Judy is an incredible resource if you are having credit issues.  Additionally Metro Brokers and Metro Brokers Financial offers our own "Credit Doctor" which has proved over and over again to be a fabulous tool for potential home buyers.  Here's Judy's recent blog and advice for those who may be considering the possibility of purchasing property within the near future.

Credit Disputes Can Delay Your Mortgage Application Even if they are Legitimate!    by Judy Jones

All lenders are requiring any disputed account on a borrower’s credit report to be resolved or the dispute removed before the loan can be approved. The reason for this is that unscrupulous “credit repair” or “credit fixer” companies have told consumers how to use (abuse) the Fair Credit Reporting Act to falsely inflate the consumer’s credit scores.

The Fair Credit Reporting Act allows for any consumer to dispute any credit account or payment history rating they believe to be incorrect. The Act requires that any account that is under “dispute” be omitted or neutralized and not considered in determining the consumer’s credit score. This Law is in place to protect innocent consumers from erroneous credit reporting.

The “Bad Guys” have used a law that is designed to protect consumers from false or erroneous reporting and have used it to help consumers with truly bad credit get their credit scores inflated temporarily. This became such a common practice that “advising a consumer to dispute everything on their credit report” has now become a “Red Flag” of mortgage fraud.

Unfortunately, honest consumers who are disputing incorrect information on their credit reports have to either remove the dispute or get it resolved before they seek a new residential mortgage loan.

Why Credit Doctor is Different

Metro Brokers Financial has a product called “Credit Doctor”. You may be thinking “but Judy, you just told us that ‘credit repair’ companies are the ‘bad guys’!” Well, the good news is MBF’s Credit Doctor is not a credit repair company, but an online tool that examines your credit and then gives you suggestions on recommended actions to fix it. It also provides you with your credit score.

Sara Hibbard is a licensed Realtor in the state of Georgia and often works closely with Judy Jones, VP or Metro Broker Financial.  Sara Hibbard focuses on assisting home buyer's and seller's alike.  Sara looks forward to answering your many questions regarding the Atlanta Metro real estate market in general or specifics regarding the buying / relocation / selling process.  Sara is easily reachable at 404-660-2481.  Sara Hibbard is Glad Georgia Real Estate is on Your Mind!