Refinance Inquiries

[EaglesFan2006]

If you have multiple inquiries out for refinancing an auto loan, does the same rule apply that says all of those inquiries will only count as one hit on your credit report if they are within a certain amount of time?  I know that exists for a new loan but wasn't sure about a refinance.

Also, I see several places that advertise cash back refinancing for auto loans.  I think the positives of something like that are pretty obvious but can someone explain the drawbacks?  I know it means you are going into more debt and borrowing more money...

[Walt_K]

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@EaglesFan2006 wrote:

If you have multiple inquiries out for refinancing an auto loan, does the same rule apply that says all of those inquiries will only count as one hit on your credit report if they are within a certain amount of time?  I know that exists for a new loan but wasn't sure about a refinance.

Also, I see several places that advertise cash back refinancing for auto loans.  I think the positives of something like that are pretty obvious but can someone explain the drawbacks?  I know it means you are going into more debt and borrowing more money...

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And you are borrowing against a depreciating asset.

[pizzadude]

If you haven't already, I'd suggest you do some reading around the auto loan boards here ~ there are many examples of people who are underwater and need to sell their car or refinance.  

This is a bad situation but would only get worse when you are even more underwater due to borrowing cash on top of the loan amount.

[Anonymous]

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@EaglesFan2006 wrote:

If you have multiple inquiries out for refinancing an auto loan, does the same rule apply that says all of those inquiries will only count as one hit on your credit report if they are within a certain amount of time?  I know that exists for a new loan but wasn't sure about a refinance.

Also, I see several places that advertise cash back refinancing for auto loans.  I think the positives of something like that are pretty obvious but can someone explain the drawbacks?  I know it means you are going into more debt and borrowing more money...

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I echo the last two posters in advising you not to borrow extra money.  I don't know why anyone would do this.  You want to build positive equity in your car, not more negative equity.

As for your original question, this depensd on how the inquiries are coded.  Most auto lenders will code them as "Auto".  However, when I recently applied  for a new car purchase, I got probably 30+ inquiries across all three reports.  Probably 5-7 of them were not properly coded as auto inquiries, and just say something generic like "Bank" or "Personal Finance".  I can only assume FICO is scoring those separately.  FICO should bunch all inquiries coded as "Auto" together, as long as they are within 15-45 days (depending on which FICO model is used).