The reason people are often told not to run their credit is to avoid excessive credit runs called "inquiries" diminishing their credit scores. It is possible to lose points temporarily from having excessive credit inquiries, but the key word here is "excessive" credit runs. Credit bureaus track the last ninety days of inquiries to determine if a credit fraud is being perpetrated against or even by someone. As the number of credit inquiries grows the credit score drops temporarily to limit credit availability and ward off fraud. You will not lose any points during normal shopping for a loan, car, credit card or mortgage unless you really go overboard with the shopping. The exact number of inquiries allowed every ninety days before scores drop is not clear as credit grading formulas vary by bureau and the bureaus also keep their grading formulas a trade secret. But, talking to a few legitimate companies while you're shopping and allowing them to give you accurate quotes by running your credit will make no difference in your credit.

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Should Borrowers Pay Points?

by Matt Killikelly

Many borrowers ask the question: Is it in our best interests to pay upfront points when buying or refinancing a home? Short answer: it depends. There is no hard and fast rule.

It’s a shame that many misguided “rule of thumb” answers are still circulating at the family barbeque or being touted within the trusted walls of the accountant’s or attorney’s office. The real answer depends mostly on the borrower’s plans for remaining in the home and their budget. There is a simple test that a borrower can conduct themselves to see what’s best for them. Read on.

Tags: mortgage upfront points buying rate