How does FICO know what kind of inquiry?

[Anonymous]

Does anyone know how FICO knows it is an inquiry specifically for a car loan or a mtg loan when calculating the "14 day" window?   They all seem to say "permissible purpose" - so how do they know the difference between...

-mtg loan app

-auto loan app

-credit card app

-opening a checking account

It would be great if they tweaked their model to exclude hard pulls for checking accounts.  Exactly how does opening checking accounts make you a bigger credit risk?  Makes no sense.

??????

[Anonymous]

---

Boscoe wrote:

It would be great if they tweaked their model to exclude hard pulls for checking accounts.  Exactly how does opening checking accounts make you a bigger credit risk?  Makes no sense.

??????

---

I can only answer the latter part of your post, sorry, I have some confusion regarding the 14 day window as well.

I completely agree with your stance however you have a possibility to bounce checks, having more open accounts makes you a bigger risk.  So maybe that's why they don't have a separate coding for pulling for checking.

Message Edited by TheCynicalOne on 11-27-2007 05:34 PM

[fused]

---

Boscoe wrote:

Does anyone know how FICO knows it is an inquiry specifically for a car loan or a mtg loan when calculating the "14 day" window?   They all seem to say "permissible purpose" - so how do they know the difference between...

-mtg loan app

-auto loan app

-credit card app

-opening a checking account

It would be great if they tweaked their model to exclude hard pulls for checking accounts.  Exactly how does opening checking accounts make you a bigger credit risk?  Makes no sense.

??????

---

FICO scoring has a "de-duplication window" and it looks at your history for the last 12 months, and when it sees two or more hard inqs for the same type of mortgage or auto loan it will ignore all but one of them as far as scoring is concerned. If the lender is using an older FICO scoring model the window is 14 days, if they are using the newest model it can be 45 days.

Also keep in mind that even though the multiple inqs count as one in FICO scoring, all of the inqs will show-up on your CRA reports for up to 2 years. Keep in mind this de-duplication window does not apply to CC apps but I really think it should.

As for apping for checking accounts w/o overdraft protection and savings accounts, I agree 100% with you. I cannot see how applying in these situatians gives banks or CUs PP to yank your credit, it's not like you're apping for new credit.

[Anonymous]

---

fused wrote:

---

Boscoe wrote:

Does anyone know how FICO knows it is an inquiry specifically for a car loan or a mtg loan when calculating the "14 day" window?   They all seem to say "permissible purpose" - so how do they know the difference between...

-mtg loan app

-auto loan app

-credit card app

-opening a checking account

It would be great if they tweaked their model to exclude hard pulls for checking accounts.  Exactly how does opening checking accounts make you a bigger credit risk?  Makes no sense.

??????

---

FICO scoring has a "de-duplication window" and it looks at your history for the last 12 months, and when it sees two or more hard inqs for the same type of mortgage or auto loan it will ignore all but one of them as far as scoring is concerned. If the lender is using an older FICO scoring model the window is 14 days, if they are using the newest model it can be 45 days.

Also keep in mind that even though the multiple inqs count as one in FICO scoring, all of the inqs will show-up on your CRA reports for up to 2 years. Keep in mind this de-duplication window does not apply to CC apps but I really think it should.

As for apping for checking accounts w/o overdraft protection and savings accounts, I agree 100% with you. I cannot see how applying in these situatians gives banks or CUs PP to yank your credit, it's not like you're apping for new credit.

---

yay, fused comes in for the save.

I think the 45 days sounds so much more reasonable.  2 weeks is not enough time to decide on such a major purchase like a car.

I think for mortgages the window should be 60 or 90 days.

Don't you agree?

[fused]

Sure why  not! I think FICO should handle CC inqs the same way too.

[Anonymous]

---

fused wrote:

Sure why  not! I think FICO should handle CC inqs the same way too.

---

I think they're trying to punish the CBO (credit bust out) folks for the CC inqs.  For fraud reasons.  Someone applying for credit all over the place and not paying it back.  They want it to hurt someone's credit for that reason.  Keep the apps to a minimum.

[yoreljm]

I have the same question...How does fico know which inquiries are for auto? My inquiries all say the same thing:

Bank of America says: Permissible purpose. This inquiry is scheduled to continue on record until Apr 2010.

My credit Union says: Credit granting. This inquiry is scheduled to continue on record until Apr 2010.

Access group says: Permissible purpose. This inquiry is scheduled to continue on record until Apr 2010.

How does fico know which are loans and which are credit cards? Is there another secret notation that I do not know about?

[Junejer]

---

@yoreljm wrote:

I have the same question...How does fico know which inquiries are for auto? My inquiries all say the same thing:

Bank of America says: Permissible purpose. This inquiry is scheduled to continue on record until Apr 2010.

My credit Union says: Credit granting. This inquiry is scheduled to continue on record until Apr 2010.

Access group says: Permissible purpose. This inquiry is scheduled to continue on record until Apr 2010.

How does fico know which are loans and which are credit cards? Is there another secret notation that I do not know about?

---

Short answer: yes they are coded a special way for FICO purposes (as mtg, as auto, as CC)

[Anonymous]

HOWEVER, that coding ONLY works if the inquiring company codes them correctly!!!
I went auto shopping last summer & there are six inquiries coded as CC & personal loan inquiries instead of auto loan/pp inquiries. It really made our score take a hit until I disputed them.

Sometimes the inquiring company doesn't code correctly, so dispute any that don't seem to make sense to you.

[Junejer]

---

@Anonymous wrote:
HOWEVER, that coding ONLY works if the inquiring company codes them correctly!!!
I went auto shopping last summer & there are six inquiries coded as CC & personal loan inquiries instead of auto loan/pp inquiries. It really made our score take a hit until I disputed them.

Sometimes the inquiring company doesn't code correctly, so dispute any that don't seem to make sense to you.

---

They can recode them. Disputing INQs with the CRAs can have an adverse affect.