When I start working with new buyers I always encourage them to start the home search by calling the bank and get prequalified. The usual response is grumbling about how they know they have good credit. For some reason, most people just hate to start their search with a call to the bank.
Today, I had my credit pulled to do a refinance of our home and boy did I have a big surprise. The loan officer asked me about my American Express bill. Well, I don't have an American Express Card. But according to my credit report, I have an outstanding balance of $57,025 along with a perfect history of making my payments on time. Thus started one of the most frustrating hours of my life.
I called American Express and when I gave them the account number on the credit report, they said they needed the number on my credit card. Well, I don't have a credit card. Finally, by giving them my social security number, they could find the account but for privacy reasons, I had to give them the name of the primary card holder. Good question. After a few guessing games, we finally figured out it was my ex-husband. She promptly removed my name from the account, and while she was not authorized to give me anything in writing to document me coming off the account, she encouraged me to call the American Express Credit Department to have this removed from my credit report.
Here is where the story gets interesting. The credit department could find no record of me ever being on the account much less being removed. They refused to verify whose name was on the account or the balance. And until I insisted that they search for me by my social security number did they even take my call serious. It seems that this account is in my ex-husbands name but my social security number and the only way they will do anything about it is if I bring formal fraud charges against him. And since this account has been open since 1981, I'm willing to bet that it's an American Express clerical error and not a case of fraud. Hopefully, together, we can get this resolved.
The moral of the story is that when I suggest you start your search for a new home with a call to a mortgage loan officer, it has nothing to do with whether or not I think you pay your bills on time. It has to do with the current mortgage lending policies and wanting to avoid the heartbreak of finding the perfect home and then learning there is a horible mistake on your credit report.