Advice on searching for lenders and how credit can be affected

[Jerry Villa]

I've heard on biggerpockets podcast hosts suggest you to keep on searching for Credit solutions, even after one bank has declined your application, so i wanted to know how does shopping around affect your credit? Do you guys have some tips on how to best shop around without affecting your credit too much? Thanks

[Alex Bekeza]

@Jerry Villa I hear horror stories all the time when I'm one of many mortgage brokers/lenders an investor is calling around to shop rates on.  People take several hard pulls while shopping and then have their score devastated when it comes time to actually begin the loan process. 

9/10 times I do not have the borrower's credit pulled until we are submitting a loan.  In terms of generating quotes I ask that the borrower supply either a copy of a recent report or some sort of other validation of their score like a credit karma report.  As long as we both have the understanding that the terms I'm quoting are based on this presumed score and will change accordingly with that score then I don't see any reason to issue a hard pull before we are ready to really pull the trigger. or like @Tom S. said I will go ahead and pull the credit if I have a firm belief that I'll be the only one doing so.