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mikehartigan
Posts: 7
Registered: ‎08-15-2010

How many inquiries are too many? How high is too high on revolving loans?

I'm looking at my credit score information provided by my mortgage lender.  I'm confused - under Equifax, for example, one of the comments is "08 - Too many inquiries last 12 months".  I went to Equifax and they report two inquiries in the past 12 months - one of which is for the loan I'm applying for.  On what planet would that be considered too many?  There is another comment "10 - Proportion of balances to credit limits is too high on bank revolving or other revolving accounts".  I have exactly one revolving account with a balance.  That balance is 8% of the credit limit on that account - it's closer to 2% of my total available credit.  Another says "11 - Amount owed on revolving account is too high".  Again, my balance is 8% of the credit limit (about 2% of my household income) and this balance becomes zero every month (though there's no indication of this on the credit report).  What's going on here?

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haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007

Re: How many inquiries are too many? How high is too high on revolving loans?

Hi, welcome to the forums!

 

I'm guessing that you have really high FICO scores, right? There is always something that the scoring formulas can find to whine about, but as scores get higher, the real impact of the "negatives" becomes minimal. That's why the scores that are provided here from myFICO list fewer and fewer of the negatives as your scores rise. But the negatives still show on the full reports that lenders pull.

 

Lenders are aware of this, and if the borrower has scores in the 780's and above (to pick a number out of the air), they don't pay attention to it.

 

Of course, if you post back that you have a 587, I'm going to feel pretty foolish. :smileytongue:

* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
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Duke-of-Earl
Posts: 204
Registered: ‎06-20-2009

Re: How many inquiries are too many? How high is too high on revolving loans?

[ Edited ]

I got the same nonsense, "11 - Amount owed on revolving account is too high", in my case ten dollars, 0.0333% of my CL.  My LO said every mortgage application she sees has this kind of comment, and she ignores them.  Can't say personally how widespread this attitude is, but from what I hear it's common.  Apparently CRAs think it's OK to be untruthful when grasping at straws.

 

haulingthescoreup gave a nice explanation of how they do this in another thread on this board, "Wow, talk about a mixed message".  And someone (sorry, lost track of who) explained how it may result from regulatory pressure to "help" people improve their scores.

 

Good luck.


Starting Score: EQ 804 - (April 2009)
Upgraded thanks to FICO Forums: EQ 813 / EX 842 / TU 823 - (FICO scores from mortgage lenders, June 2010)
Recent Scores: EQ 807 / TU 799 - (March 2012)
Goal: Survive Another Day
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Member
mikehartigan
Posts: 7
Registered: ‎08-15-2010

Re: How many inquiries are too many? How high is too high on revolving loans?

[ Edited ]

haulingthescoreup, I'm at 798.  I can't help thinking I'd be above 800 without this BS.  I'm not worried about not getting the loan, it's the principle (and maybe some bragging rights).  With whom can I plead my case?

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haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007

Re: How many inquiries are too many? How high is too high on revolving loans?

[ Edited ]

 


mikehartigan wrote:

haulingthescoreup, I'm at 798.  I can't help thinking I'd be above 800 without this BS.  I'm not worried about not getting the loan, it's the principle (and maybe some bragging rights).  With whom can I plead my case?


 

lol, that's what I figured.

 

How long before the older inquiry on EQ hits 12 months old? You'll get some points back then, especially if there was a new account that resulted from that inquiry that also turns 12 months old.

 

It probably varies by bureau, as all three each have their own FICO score formulas, but in my experience, the first inq on EQ is "free", meaning no score drop. The second costs 3-5 points. Then the third one is free, and the fourth costs a few more points. I * think * the same thing happens with #5 & #6, after which there are no more point losses. (You just have to worry about being turned down by lenders for being app-happy.)

 

You also might get a few more points by having a lower util displaying, down around 2-3%, but that's very much a guess.

 

Another possibility is that if you have 3 or more CC accounts with balances, try having just one or two report a minimal balance (and then pay them off.) I've lost 10-15 points for having 3 or 4 accounts with balances. This is out of 10 open cards. (Note that this doesn't include car loans, mortgages, etc.) Don't have all of them report $0, or you'll lose points for that, too. :smileytongue:

 

In other words, there's no human to whom you can plead your case, other than gnashing your teeth with the rest of us here on the forums. It's the scoring algorithm crunching the data in your credit bureau reports (Equifax in this instance.) If you can tweak the data by lowering util and the number of accounts with balances, you might get your points. Otherwise, wait until the older inq hits a year, and I think you'll see it then.

* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
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my-own-fico
Posts: 1,141
Registered: ‎01-05-2010

Re: How many inquiries are too many? How high is too high on revolving loans?

 


haulingthescoreup wrote:

 

It probably varies by bureau, as all three each have their own FICO score formulas, but in my experience, the first inq on EQ is "free", meaning no score drop. The second costs 3-5 points. Then the third one is free, and the fourth costs a few more points. I * think * the same thing happens with #5 & #6, after which there are no more point losses.


 

I apologize for bringing life back into such an old thread lol, but what you're saying feels so right (my 2nd TU inquiry and DW's 2nd EQ inquiry). :smileyvery-happy:

 

When it comes to wishful thinking vs reality, wishful thinking wins.

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