Rapid Credit Score Decline after Purchase

[Sean Thompson]

Hi all,

I purchased my first rental property, a 3bd/2bath condo in Raleigh, NC in May of this year. I had outstanding credit in the low 800s/high 700s prior to securing approximately 185K in a conventional mortgage loan after putting 10% down for a primary residence house hack.

Researching online, it looks like credit should drop approximately 15-40 points after acquiring a mortgage, but my credit shrank all the way to 685. I have no other major credit debt, ~10K between student loans and other pay as you go purchases. Not sure my debt to income ratio but I have > 150K in assets and my w2 is well above six figures. When I opened my credit report I see no suspicious activity that would warrant an 120 point decline.

Has anyone experienced this issue and if so how did you handle it? I want to continue to build my portfolio with at least another house hack in 2023, but concerned I won't get the best loans with this drop. Thank you for your feedback!