Q: I am a first-time buyer and am pre-qualified for my loan. Every time I make an offer for a property, the seller counters but also asks for a copy of my credit report.
I find this quite intrusive since it contains personal information. On my first offer I had my agent advise the selling agent that I was not willing to send that information, but that I would provide a copy of my credit score. Needless to say I did not get the place.
On the other offers, I took the time to black out my social security number and account numbers and after checking and double-checking, I noticed that I had missed my social security number on one page, after it had been sent.
Most of the people that I have talked to who have purchased homes have not had this information asked of them. Is this a new practice?
A: I have never heard of this happening. In most cases, the seller or the seller’s agent takes the buyer’s agent’s word that the buyer is financially solid.
One thing you can do to assure sellers that you’re financially qualified to buy the property is to get preapproved for your financing. When you get preapproved, rather than prequalified, the lender commits in writing to funding your loan provided that the home appraises out in value.
When sellers ask for your credit history, they’re trying to figure out if you’re financially qualified to buy their home. They think they’ll be able to tell that you’re credit-worthy and will get your financing by looking at your credit history and credit score. In truth, most sellers are unable to decode event their own credit history report, let alone understand what it tells about someone else’s credit history.
In the meantime, you’ve been providing your credit history (albeit the most sensitive information has been blacked out) and you’re still not getting your offers accepted. So, perhaps something else is going on.
Start by getting your financing in place. You may not even have to pay an application fee. But once you have that loan commitment letter in hand, you can either provide a copy to a seller or simply tell them that you’ve already been approved for financing.
The seller will know that you’re the strongest buyer in sight, and your offer will likely be accepted.
But clearly, something else is going on. Take a look at the next letter.
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