Hard Inquiry Ruining Credit

[Anonymous]

Hi,

Two days ago, I went to a car lot just to look around and price the vehicles they have in stock.
I informed them of my FICO 8 score using data from Experian that is offered by Discover card at no cost
(which showed a 773). Also, I told them that Equifax has no credit data on any of my accounts and that
only Experian and TransUnion does. Also, that I had just recently paid off the vehicle I currently have
with 100% on-time and in-full payments, a perfect payment record over the 3 years and the payments were
$300 per month. They took down some information from me stating that it would save time if I decide I
want to go through them to make a purchase. They handed me a sheet of paper asking if the information
was correct and, if it was, to sign verifying the info was accurate. They used this to run a credit
check, unbeknowst to me, adding a hard inquiry to my credit. I did not realize that was what the paper
they asked me to sign was for as they did not state as such. I only found out when I got an alert on
my cell phone. When I asked about why, they said they don't need to inform me they were going to run
my credit.

Further, they said that the $6,995 vehicle I was interested in would require me to make a minimum of
$700 per month payments over 3 years, which would be $25,200! They said that they checked Equifax and
I have no record of any vehicle purchased and no credit history. I then promptly left this car lot,
that claimed 100% are approved, because of the, possible illegal, practices toward potential customers.

Today, I checked my Experian FICO score and that one single hard pull dropped my score from 773 all

the way down to 692, a drop of 81 points! Now, with this hard inquiry on my record, which will persist

for 2 years, I am hesitant to continue looking for a better vehicle, and one the family and I really need.

I feel a second hard inquiry may drop my score down to near the 500's as anothe rdrop of 81 would

put me at 611. Just ONE hard pull has totally ruined my credit and not sure what I can do. Is this normal

for one's credit to be completely ruined from one or two hard pulls? I don't understand this at all!

I hope someone can give me some piece of mind about what is happening. As it is now, it may take me

another 2 years to bring my credit score back up to where it was before this pull on my credit.

HillbillyBB

[Remedios]

Hi and welcome to the forums @Anonymous 

I do not believe it's possible for an inq to drop your score by 80 points. 

I know you said you looked at your score using Discover score card, but have you actually looked at the report itself? That much of a drop is more indicative of negative info than anything else. 

[Anonymous]

There is nothing negative on my report that I can see. Payment history is 100%, zero derogatory marks, 7 year credit history and the only negative thing is the hard pull. That's why I don't understand how a single pull can drop the score from 773 to 692. With this much of a drop, I feel I will need to wait between 1 and 2 years to purchase another vehicle. I never realized how much of a major impact a hard pull is to the credit when I was led to believe a drop of about 5 points was the normal. I now know this is not the case but it has a signifivant impact on the credit score as well as one's credit worthiness, 3 years of perfect payments notwithstanding.

[kilroy8]

Many things here don't compute.

You mentioned that you have Discover. They absolutely report to Equifax.

80 point hit from even several inqs is not possible.

Interest at the rates you say the car lot quoted you is illegal in most states.

[DH1988]

The exact same thing happened to me when I was car shopping. I emailed the car salesman the next day asking why he ran my credit when I specifically asked that he not do a HP and his manager responded apologizing on his behalf and explaining it was a mistake. Okay, great but the inquiry was still on each of my reports. I made a similar post and a myFico commenter suggested I file a complaint with the Consumer Financial Protection Bureau.  I did that last week -- it's in progress so I don't know if the inquiry will be removed but it's worth a try. You can also write letters to each of your credit bureau's explaining you did not authorize them to run your credit and request that they be removed. 

Hope this helps, goodluck! 

[calyx]

As others say - this information isn't adding up.

No, the INQ did not drop your score 80pts on its own.

And as for the CFPB - if you signed something saying they were authorized/had permission to pull your credit, filing a report won't help.   You mentioned the piece of paper - and what they told you - did you actually read it?  You may have signed authorization for a pull without realizing it.

[StillKicking]

Hmmm. Doesn't make sense. The last vehicle I bought dropped my score less than 10 points. But it went back up (and then some) after I made the first payment.

How recent did you pay off the car? Perhaps the installment loan being paid off had something to do with the drop in points.

You obviously now know this, but NEVER SIGN ANYTHING until you've negotiated EVERYTHING and are ready to purchase. EVER. And Then triple check all paperwork.

Did Experian give you an explantion why the drop in points?

[randomguy1]

What was the date of your Discover score vs the date in your latest score? Are they both from the same source?

[Anonymous]

Look again at your reports and see if old positive, closed trade lines dropped off. Losing that history and the drop in your account aging factors would cause far more potential points lost than one inquiry, and even that is doubtful to fall 81 points. That bug a drop is a sign of negative info being introduced...

[Anonymous]

Discover scorecard is not your credit report. It's just a summary and a score. You need to get your actual credit report to see what the issue is. Go to creditchecktotal.com and do the $1 trial. You will get all three reports.

Your score, even after the drop is fine for getting a car loan. Stay away from the "every is approved" places. Fact is the name brand lots have access to sub prime lenders too if your credit situation needs it and you will not have to pay 4 times the price of the car in interest.

Also lock/freeze your reports before car shopping. That will prevent unwanted pulls until you are ready to finance.