On a mortgage or other current active account in good standing, why does the creditor do account reviews? Is it to compare the payment history on your reports to their records? Or some other reason??
Unsecured creditors are looking for signs you have overextended yourself or, are paying others slowly or if you're in default. They will then slash your credit line and raise rates. A/R's on a mortgage are different. Mortgage backed securities trading is one of the most active markets in the world among institutional investors. Few lenders keep a mortgage in a porfoilio. Mortgages are placed blocks in the millions of dollars and traded. The only way you can price the mortgage {from the stand point of both buyer and seller} is to look at the stability of the underlying credit. They won't change the terms of your mortgage but, it can sure affect the value of the mortgage to every presently owns it.
OK, but in the case of the mortgage, they already have my payment history and info in their computer...so why pull a report? Or does my over all credit score have something to do with how much they can sell the loan for?
They want to know if you are behind in payments in other lines of credit or your balances are so high that you may have overextended yourself. Very few investors would want a mortgage from a person who has tens of $$$ in credit card debt and may have a few late payments on them. They want the total credit profile of the mortgage they are buying.
