A rapid credit rescore is initiated by a lender, usually a mortgage lender, which addresses mistakes or errors in a borrower's credit history and has them updated with a credit bureau before getting a "rescore," reports Bankrate. The update to the credit file can improve a credit score.
Although often the improvement may be only a few points, such a shift may be crucial in obtaining a certain type of mortgage loan, reports Bankrate. Although not every lender offers the option, those that do can have the updated-and-corrected information verified by their credit-reporting entities and submitted to the credit bureaus within days, allowing for the new score to be used in the loan process. Credit bureaus offer this service to lenders and residential mortgage credit reporters for a fee.
The process of obtaining a credit rescore is not credit repair, warns Bankrate. It cannot correct damage done to a credit score from such actions as accurately reported late payments or bankruptcies. Mortgage lenders use this tool to get a more accurate reading of a borrower's credit worthiness and not to rig the process. Most of the time, lenders know exactly the effect of correcting mistakes or outdated information on a credit report, thus they recommend it only if they know it is going to make a difference.