topic Re: Automotive Inquiries (Hard pulls) in General Credit Topics

Automotive Inquiries (Hard pulls)

Anonymous — Sun, 19 Nov 2017 03:45:45 GMT

I got a car loan in May of 2016. At the time, there were 3 hard pulls from 3 different lenders. My understanding is that if there were hard pulls for the same purchase in a relatively short period of time that they only count as one hard pull.

I just signed up for WalletHub and they have 4 hard inquiries listed. One is for Synchrony and it's legitimate. The other 3 are for the car and all are due to fall off on the same day. However, they are all listed as a different type. Chrysler Capital (my lender) is listed as "finance". Quirk CDJR (no clue) is listed as "automotive". Ally Financial is listed as "national credit cards/airlines".

Is my credit being dinged more than necessary because of these all being listed as different types of lenders? They are due to fall off July 1, but I'm applying for a mortgage in the next few months and want to clean up my credit as much as possible. Is this a reporting error that is adversely impacting my credit?

Thanks!

Re: Automotive Inquiries (Hard pulls)

Moneyklutz — Sun, 19 Nov 2017 03:57:04 GMT

I could be wrong but my understanding is that the multiple pulls show on your reports but do not count as more than one in the actual scoring.

Re: Automotive Inquiries (Hard pulls)

EAJuggalo — Sun, 19 Nov 2017 13:18:59 GMT

Mulitiple pulls that are CODED CORRECTLY are combined for scoring purposes. The issue here is one that I have as well, not all of the OP's inquiries are coded correctly so they are getting hit with them. That said, general consensus around here is that for FICO 8, inquiries stop being scored after one year even though they stay on your report for two. I have no idea how they would effect Mortgage scores but it's possible it means more.

Re: Automotive Inquiries (Hard pulls)

DaveInAZ — Sun, 19 Nov 2017 13:51:22 GMT

@Anonymous wrote:
I got a car loan in May of 2016. At the time, there were 3 hard pulls from 3 different lenders. My understanding is that if there were hard pulls for the same purchase in a relatively short period of time that they only count as one hard pull.

I just signed up for WalletHub and they have 4 hard inquiries listed. One is for Synchrony and it's legitimate. The other 3 are for the car and all are due to fall off on the same day. However, they are all listed as a different type. Chrysler Capital (my lender) is listed as "finance". Quirk CDJR (no clue) is listed as "automotive". Ally Financial is listed as "national credit cards/airlines".

Is my credit being dinged more than necessary because of these all being listed as different types of lenders? They are due to fall off July 1, but I'm applying for a mortgage in the next few months and want to clean up my credit as much as possible. Is this a reporting error that is adversely impacting my credit?

Thanks!

Are you in Massachusetts? A Goggle of "Quirk CDJR" comes up with Quirk Chrysler Dodge Jeep Ram in Marshfield MA.

I wouldn't worry about the 3 inquiries, if the mortgage underwriter asks about them they're easy to explain with the car loan showing on your report, they understand buying a car usually results in multiple inquiries. But is your DTI going to be OK with that car payment? Mortgage lenders don't like your DTI (Debt to Income ratio) to be more than 40% with the new mortgage.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Sun, 19 Nov 2017 16:20:41 GMT

Dave - Yes, I'm in MA. It's my understanding that most people have car loans. I can actually only think of one person that I know that has a mortgage that has a car that's paid off. I understand the DTI < 40% for a new mortgage, but having a car is non-negotiable in the suburbs, so there's not much i can do aboput that piece of the puzzle.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 15:03:26 GMT

Inquiries older than 12 months have zero effect on FICO scoring. They hurt the most for 0-6 months, and then they hurt less from 6-12 months.

Those inquiries don't matter anymore. May 2016 is over 12 months behind you, so they're worth 0 FICO points.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 15:22:36 GMT

That's so strange because I attempted a CLI about 2 weeks ago from Synchrony. I was denied and the letter they sent included "too many inquiries" or something to that effect as a reason for denial. If the autmotive inquiries don't count, that leaves me with a grand total of 1 inquiry from 9 months ago... which was by Synchrony when I originally applied for the card.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 16:04:28 GMT

It's not strange at all -- the "Too Many Inquiries" response is actually 100% BS and not true for most lenders.

When a lender denies you for any reason, by law they're required to give you a reason. The law just says they must give you a reason but the law doesn't say they need to give you the real reason for denial.

So lenders pay FICO for the scores, but they also pay FICO for "reason codes" that abide the federal regulations on reporting. Synchrony paid FICO to give them a reason, any reason, why there was a denial.

"Too many inquiries" is not the reason they denied you, it's just a legally acceptable reason per the federal regulations and guideliens.

You have other problems with your profile internally with Synchrony (maybe you don't spend enough, or maybe you had a late payment to them but not late enought or report, or maybe you had a returned payment to them, or any of hundreds of other non-FICO reasons).

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 16:15:09 GMT

Thank you for the info. I've never had any issues with Synchrony, period. No late payments, missed payments, returned payments, etc. I have used the card every month that I've had it and I've spent varying amounts. I've read in other forums that Synchrony likes to see a score of 650 in order to get a CLI, and I'm currently at 640 TU. I'm guessing that was the reason.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 16:46:28 GMT

@Anonymous wrote:
Thank you for the info. I've never had any issues with Synchrony, period. No late payments, missed payments, returned payments, etc. I have used the card every month that I've had it and I've spent varying amounts. I've read in other forums that Synchrony likes to see a score of 650 in order to get a CLI, and I'm currently at 640 TU. I'm guessing that was the reason.

Correct, Synchrony is VERY TU specific. I got my Amazon store card around 640 and the CLI button didn't even appear on the website. When I got to 650 or so, I requested a CLI in chat and got $5000 (from $400 starting limit). Then when I hit 699 TU, I got a $1000 bump to $6000.

Remember always that "reason codes" for any denials don't actually always tell you the reason. They just tell you "a" reason, even if it's false.

Re: Automotive Inquiries (Hard pulls)

Anonymous — Mon, 20 Nov 2017 17:08:59 GMT

Thank you! You're such a wealth of great information. I actually left a question for you yesterday in another thread I had started: http://ficoforums.myfico.com/t5/Mortgage-Loans/Thoughts-on-this-plan-to-boost-credit-score-to-qualify-for/td-p/5093149 because you had great advice. I'm also wondering if I should try the SCT to get another tradeline in my own name without risking a hard pull. You did suggest it, but my youngest account right now is the Synchrony Amazon card at 10 months. (Or will be when the lenders report at the begining of December.) Is the hit I will get from adding a new account worth it? I just need to increase my score as quickly as I can, without jeopardizing my credit in the future. The VS card is actually one I would put to good use as I shop there anyway.