topic Re: Unauthorized Inquiry in Rebuilding Your Credit

Unauthorized Inquiry

Anonymous — Tue, 07 Sep 2010 17:27:16 GMT

I just pulled my "score" on CreditKarma (was just checking to see if my credit card balances had been updated on Transunion yet) and was surprised to see that my score had gone down a few points - the reason given was that I had an additional inquiry on my report. I know I haven't applied for anything recently, so I pulled a copy of my TR report to see if a new inquiry had really jumped on. Turns out the bank that holds my mortgage (a local bank here in Seattle) did a hard pull of my report on 9/3. Do they have the right to do that, and if not how can I get rid of it? I'm also kind of freaked out, because why would they do that? It's not like it's a credit card, or even a HELOC that could be reduced. It's a mortgage, the only loan I have on my property. I have never paid it late ever. Maybe I'm just being paranoid, but there's nothing they can do - like take away my mortgage, right??

Re: Unauthorized Inquiry

JoeBJay20 — Tue, 07 Sep 2010 20:46:44 GMT

It all depends on your contract. But if your loan is already approved, there's really no reason for them to be doing a hard pull. You can contact the bank and request that they remove the hard pull or have it recoded as a soft inquiry. But you can relax, as long as you're paying on time, they can't take away your mortgage. It's still a legally binding contract, as long as you're meeting your end of the bargain there is no reason to be alarmed.

Re: Unauthorized Inquiry

Anonymous — Tue, 07 Sep 2010 21:12:32 GMT

Thanks JoeBJay - logically I knew that, but it's reassuring to hear it from someone else as well. It just doesn't seem logical that a bank would do account reviews on a MORTGAGE - it always seemed strange seeing those soft inquiries (like I get from AMEX and other companies that I have CREDIT LINES with) from my mortgage company, and now getting hit with this hard inquiry I got kind of scared. I'll definitely call them and see about getting it recoded to a soft inquiry, and maybe they can explain why they keep checking my credit even though they extended me a mortgage more than 2 years ago!

Re: Unauthorized Inquiry

JoeBJay20 — Tue, 07 Sep 2010 21:20:23 GMT

You're welcome, in the current economic climate, we're all a little skittish. Things that we would have shaken off years ago now traumatize use.

Re: Unauthorized Inquiry

chasmith — Tue, 07 Sep 2010 23:20:29 GMT

If the bank either hasn't sold your mortgage, or sold it and kept servicing rights, but is now being audited for underwriting (if whatever pool they packaged it into has gone sour and they're being pushed to buy the loans back), they may want your current credit status for their purposes - a good reason they shouldn't do a hard pull when they have the permissable purpose of account management to do a soft pull.

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 00:40:02 GMT

@Anonymous wrote:
Thanks JoeBJay - logically I knew that, but it's reassuring to hear it from someone else as well. It just doesn't seem logical that a bank would do account reviews on a MORTGAGE - it always seemed strange seeing those soft inquiries (like I get from AMEX and other companies that I have CREDIT LINES with) from my mortgage company, and now getting hit with this hard inquiry I got kind of scared. I'll definitely call them and see about getting it recoded to a soft inquiry, and maybe they can explain why they keep checking my credit even though they extended me a mortgage more than 2 years ago!

There are quite a few good reasons why a mortgage holder would do account reviews, but generally they are soft pulls. I've never had a hard pull for an AR. I'd bet the person who pulled the credit report messed up and didn't code it as an AR.

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 01:03:50 GMT

JoeB that is NO JOKE! Its funny how the older we get the more worried we get about the smallest things. Even in this instance an inquiry! IMO I think that ANY time your file is pulled you should me notified before hand to contest it giving you some real control as far as what gets put on your CR.

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 16:54:34 GMT

Thanks for the extra insight Chas. O6 - what are some of the reasons they'd do a an AR?

Re: Unauthorized Inquiry

MarineVietVet — Wed, 08 Sep 2010 16:59:45 GMT

@Anonymous wrote:
Thanks for the extra insight Chas. O6 - what are some of the reasons they'd do a an AR?

I'm not speaking for O6 but IMO creditors do AR's to see if you are possibly getting yourself in trouble financially. If they see your utilization had gone up drastically or you have applied for alot of new credit that could make them nervous and trigger a possible AA (Adverse Action) against you.

I might be totally wrong about that but I'm sticking to my story.

From a BK years ago to:
EX - 9/09 pulled by lender 802
EQ - 7/06-663, 3/10-800
TU - 8/10-772
You can do the same thing with hard work

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 17:09:11 GMT

Marine - thanks for the response, and I understand that with credit cards or HELOC's, but with a mortgage they CAN'T take AA against me based on my credit report. They could only ever do anything if I was late or missing payments. That's why I was concerned and double checking with the boards for reassurance Now I'm just curious why a mortgage company would do an AR. I mean, it might tell them if I'm a higher risk of missing payments - maybe some kind of risk management on their end?

Re: Unauthorized Inquiry

MarineVietVet — Wed, 08 Sep 2010 17:14:42 GMT

@Anonymous wrote:
Marine - thanks for the response, and I understand that with credit cards or HELOC's, but with a mortgage they CAN'T take AA against me based on my credit report. They could only ever do anything if I was late or missing payments. That's why I was concerned and double checking with the boards for reassurance Now I'm just curious why a mortgage company would do an AR. I mean, it might tell them if I'm a higher risk of missing payments - maybe some kind of risk management on their end?

I totally overlooked that it was a mortgage lender doing the AR. (I need to get more sleep at night). You're correct that they have no option of an AA unless you are having problems with their loan.

Since I can't answer your question I will leave now.

From a BK years ago to:
EX - 9/09 pulled by lender 802
EQ - 7/06-663, 3/10-800
TU - 8/10-772
You can do the same thing with hard work

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 17:21:59 GMT

At least you're one more person reassuring me that from the mortgage stand point I have nothing to worry about it Your help is always appreciated!

Re: Unauthorized Inquiry

chasmith — Wed, 08 Sep 2010 17:31:37 GMT

The mortghage company could be doing risk assessment to defend selling your mortgage in a package, or trying to get ready to package your mortgage into a security. Or there could be a valuation exercise going on, remmber how the great financial engineers on Wall Street cooked the economy by slicing and dicing mortgages into securities.

Re: Unauthorized Inquiry

Anonymous — Wed, 08 Sep 2010 23:49:40 GMT

@Anonymous wrote:
Marine - thanks for the response, and I understand that with credit cards or HELOC's, but with a mortgage they CAN'T take AA against me based on my credit report. They could only ever do anything if I was late or missing payments. That's why I was concerned and double checking with the boards for reassurance Now I'm just curious why a mortgage company would do an AR. I mean, it might tell them if I'm a higher risk of missing payments - maybe some kind of risk management on their end?

Wrong.

Yes, they most certainly can take AA based on indicators on your credit report. Granted the AA they could possibly take is nothing like with a credit card account, they can recall your entire loan and if you don't pay the total mortgage amount balance due within a certain, very short period of time, you're on your way to homelessness.

Virtually every mortgage ever written has an acceleration clause which can be triggered by certain events such as, but not limited to, insolvency or failure to pay taxes. Aside from the fact that each and every one of your current creditors has the right to pull your credit at any time, they could be looking for signs of distress or, what I believe more likely, the scenario painted by Chasmith.

Re: Unauthorized Inquiry

Anonymous — Thu, 09 Sep 2010 00:19:11 GMT

O6 - So my concerns (the ones I thought were unfounded, but had nonetheless) are in fact correct? Even if my payments, taxes, homeowner's insurance, etc. are paid on time, the bank could demand payment in full on my mortgage if they found negative activity on my credit report?

Re: Unauthorized Inquiry

Anonymous — Thu, 09 Sep 2010 00:43:21 GMT

@Anonymous wrote:
O6 - So my concerns (the ones I thought were unfounded, but had nonetheless) are in fact correct? Even if my payments, taxes, homeowner's insurance, etc. are paid on time, the bank could demand payment in full on my mortgage if they found negative activity on my credit report?

I wouldn't go so far as to say they can / would accelerate the loan simply because you are behind on some -- or all -- of your other obligations, but there are circumstances in which they could and thus not totally unreasonable that they perform an account review with your credit report from time to time. That said, Iin my experience INQs from current creditors, to include mortgage lenders, should be softs.

If you look at your mortgage agreement there will inevitably be an acceleration / demand clause. Again, not paying Sears wouldn't be cause for concern, but insolvency or tax liens would be. Basically, anything that substantially reduces the value of the collateral (home), causes subordination of the mortgage holder's lien, indicates insolvency or fraud and certain types of refinancing or a possible undisclosed sale of the property can result in the loan being called.

I wouldn't worry much about the INQ. Over the years I've had a few mortgages and most would soft every quarter and some even every four months. Those b'tards at BOA softed me almost daily even though I had over 90% equity in the property. But all the INQs were soft. Give your mortgage lender a call and ask them to do the right thing by changing the INQ to a soft.