Credit Report Inquiries
There is a bit of often
misunderstood information regarding your credit report and how inquiries into
them negatively affect them. There are two types of credit inquiries and only
one of them negatively affects your score. The ones that affect your score are
referred to as "hard" inquiries. This is when you have applied for actually obtaining
credit. "Soft" inquiries refer to things such as when you check your report,
businesses may check your report to then send you pre-approved credit cards
or a possible future employers checking of your credit report. If you look
at your credit report, you will see all of the details, both soft and hard inquiries
into your report, where as a creditor will only be looking at the hard inquiries.
The reason
as to why this negatively affects your score is because it is an indication that
you could be financially stressed and you are seeking out credit to help save
you or that you are taking on more debt. But having one or two hard inquiries
over a longer period of time will probably not affect it much if anything at
all. If you have four or more hard inquiries within a two month period, a message
is listed on your credit report indicating that you are desiring excessive credit.
You can also
challenge/dispute any hard inquiries on your credit report. You would need to
deal directly with the creditor pulling your report. In a letter you can ask them
to prove that you authorized them to pull up your report, if they can not prove
this that they actually are legally obligated to remove their inquiry from
your report. Often a creditor would not even want to bother going back within
their records to verify it. You can also challenge the credit bureau itself asking
them what justifiable reason did they have to even provide that information
to the creditor in question. Equally, if they cannot present the information they
by law have to remove this inquiry.
|
