I bought a personal residence in July of this year, and an investment property in September of this year. To date neither of these loans are showing on my credit report.
Is my credit suffering as a result of this? Or would this actually hurt my credit by affecting my debt to income ratio? Basically I’m trying to decide whether I should be calling the banks and asking them to report my loans and my payments.
I would suggest calling them to report as mortgage history can increase your scores.
It may affect your Debt-to-Income ratio but only you would know that. I’d suggest turning that second home into a rental so you’ll offest the DTI and get a tax writeoff.
My personal residence showed up on the 11th at Experian. My experian score was 661 on Nov 6, and then on Nov 11 it was 671. So a 10 point boost just for that showing up ;D
The second property hasn’t shown up yet, but it is indeed a rental.
Though it is true that mortgage history can increase your credit score, it can also hurt it when you are purchasing multiple properties within a short period of time. I had a client whose scores dropped 100+ points from obtaining too many mortgages in a short period from buying investment properties quickly.
That is true…
:o 100 point drop? Hope that doesn’t happen to me! I’ve worked so hard to get my scores to where they are now. But it’s not going to prevent me from buying, that’s for sure. Wonder what “a short period” is defined as, according to the credit beaurus.
Yes the scores do drop but they will pick up very strongly once you make a few payments…Mine droped about 50 points after purchasing 2 homes at the same time, but rose by 75 points after 2months…It called a credit shock