Let's Talk Inquiries....

[LadyLeah]

In your rebuilding process, what is the max number of inquiries you've had at one time?

Was it strategic, and did your strategy ultimately work in your favor? After the hit, how long before your score began to rebound?

[randyrhodes]

I've got like 20! On my Equifax report. I know...way too many. Took me a while to find a small loan company willing to take a chance on me and give me a loan. I didn't know at the time that installment only accounted for 10% of scoring. But I got the loan and most of the 20 are from late 2012 or early 2013 so probably not hurting me as much. Transunion is my highest score at 626 and I'm scared to apply for anything that only pulls them. Lol

[LadyLeah]

Wow!!! 

Was it worth it for you, Randy? And if you had to guess, how many points would you say you lost from the inquiries?

[LadyLeah]

When I started this process in January, I had 0 inquiries. 

I now have 2. I don't think I really took a hit from that. Maybe a couple of points. But I opened up 3 new positive TLs, and gained a total of about 11 pts from having the new cards, despite the fact that it significantly lowered my AAoA. I suspect (hope) that in time, my scores will continue to increase as my positive payment history outweighs my aging lates. 

[randyrhodes]

Oh I'd say I probably lost around 12 to 16. My score was low after I filed bankruptcy and I wasn't so much worried about the points at the time. I had to start somewhere just like everyone else. So...in the long run..yes it was worth it.

[DaveSignal]

I've had around 25 before, but now have about 12 across all 3 CRAs, and 4 of those are for a single auto purchase. I have noticed that you lose more points per inq when you have very few inqs. After awhile, the additional inqs have little to no effect at all. But they score hit lasts for a full year. I have watched as inqs fall off the scoring by passing the 1 year mark and noticed regaining the points at that time.

[Pot-ting-ting]

I have about 14 inquiries and am stressing a lot over it.  My Eq fico is 648 I will see how much it drops about 5 were from this week.  My score a year ago was 546 so feel like I have come long way.  

[RobertEG]

I would suggest an overall strategic approach that  looks at more than curent or one year impact of only inquiries.

My very first consideration would be, do you plan to need your score for an important and necessary app for credit within the next year, such as a car or mortgage?

If so, the short terms hit on your score and the showing, particurlay to a mortgage lendor, of numerous other quests to increase your available credit might be viewed as potential for additonal debt to others that might impact your current debt to income, etc.

However, if your apps are primarily to build or rebuild, and you have time to let the dust settle from the shorter term impacts of new inquires and AAoA impacts before a necessary quest for other credit, I would first evaluate your current accounts, and how you can improve your mix.  The inquriy hits will be gone in a year, and if your currrent AAoA is relatively low, the new accts wont have as much overall impact on AAoA as it would if you have an old current portfolio.

Primary focus might be on revolving credit, as that is the most highly wieghted in scoring.

Do you currently have multiple revolvings, with at least one bank card?

If not, that would most likely be my focus.

However, if you do have multiple revolvings with at least one back card, buliding increased CLs on those cards may be the way to go rather than taking AAoA hits.

If the current revoving portfolio is young, it might be better to build some age, thus showing decent period of effective use of discretionary, revolving credit before apping for crap cards.  Longer age may get you better terms and credit limits by waiting a bit, and not simply adding small CL cards that will have dimininmus scoring effect in improving mix or utlil, and will almost definately involve short-term hits in new inquiries and on AAoA.

For those who are in need of a quick score boost to begin building a revolving portfolio, then getting addes as an AU on the solid account of another might be a short term benefit.  If you can get a quick score pop that way, and apping for lower CL cards that rely primarily or solely on your FICO score, it can be a very effective building tool.

However, as your quest for credit moves up to better and higher CL cards, then the AU status might become a detriment.  As the amount of credit or credit or credit limit increases, so does the chance of a more thorough, manual review of your credti report.  Seeing that your score is based on the history of another tells the creditor that your score does not represent your own, personal risk evaluation, and having not way to back out an AU account, might put into question the value of your entire score in their evaluation.

I would place new installment credit at the bottom of the barrell, as they dont help a much unless you have no installment accounts.

Inquiries are a consideration, but may not be the primary focus in rebuilding.......

[LadyLeah]

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@DaveSignal wrote:
I've had around 25 before, but now have about 12 across all 3 CRAs, and 4 of those are for a single auto purchase. I have noticed that you lose more points per inq when you have very few inqs. After awhile, the additional inqs have little to no effect at all. But they score hit lasts for a full year. I have watched as inqs fall off the scoring by passing the 1 year mark and noticed regaining the points at that time.

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@Pot-ting-ting wrote:

I have about 14 inquiries and am stressing a lot over it.  My Eq fico is 648 I will see how much it drops about 5 were from this week.  My score a year ago was 546 so feel like I have come long way.  

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Pot, congrats on your success thus far. That's great progress! I hope to get to where you are soon.

I'm not sure how FICO calculates inquiries, but I know Credit Karma calculates them in buckets. You have optimal scoring (grade of A) for having 0 inqs, then you lose a few points (grade of B) for having 1-2 inqs, then C for having 3-6, D for 7-10, and an F for 11 or more. So assuming FICO has a similar method of calculation, it seems that once you get past 10 (or whatever the FICO number is), it doesn't really matter how many you have in terms of your actual score. 

So Pot, if you had 9 and gained 5 more, you may only take a ding for the first one or two. I'll keep my fingers crossed. :-)

[Pot-ting-ting]

Thanks. I am waiting to see what happens with scorewatch fico but my transunion fako and experian faco went up 9 & 15 points by increasing my available credit. I think my score was already as bad as it was going to get from the additional inquiries. Boa gave me $2000. Walmart 900. And capital one $500  so it was worth it.