How does inquiry works?

Anonymous · ‎11-14-2016

Originally posted in Mortgage forum and was directed to ask the question here.

I am shopping for mortgage rates and it was my understanding that inquiries within 14 days calculates as one and would not affect credit score much. I applied for a pre-approval 2 weeks ago and it increased the count in my credit score by 2 (lowering the score by 5). I applied again at another place yesterday and it increased the count again to 3. My credit score went down to 39 points at Equifax.

Here is the timeline to make it easier.

1) 5/24/2016 - applied for mortgage (declined) - inquiry count 1 (4 points lowered)

2) 10/31/2016 - applied for mortgage - inquiry count 2 ( points lowered)

3) 11/13/2016 - applied for mortgage - inquiry count 3 (39 points lowered)

As you can see that last 2 inquiries were within the 2 weeks span. Why would it count separately and hurting my credit that bad?

Anonymous · ‎11-14-2016

Do you have tools that would enable you to pull your credit reports in a couple days? If so, it would be interesting to see how these two inquiries were coded. They need to be coded both as "mortgage" inquries to take advantage of the 14-day weekend. A 39 point drop seems excessive for even two inquiries.

By the way, which score was it that dropped? Was it your EQ mortgage score or your EQ FICO 8 score?

Revelate · ‎11-16-2016

@Anonymous wrote:
Originally posted in Mortgage forum and was directed to ask the question here.

I am shopping for mortgage rates and it was my understanding that inquiries within 14 days calculates as one and would not affect credit score much. I applied for a pre-approval 2 weeks ago and it increased the count in my credit score by 2 (lowering the score by 5). I applied again at another place yesterday and it increased the count again to 3. My credit score went down to 39 points at Equifax.

Here is the timeline to make it easier.

1) 5/24/2016 - applied for mortgage (declined) - inquiry count 1 (4 points lowered)
2) 10/31/2016 - applied for mortgage - inquiry count 2 ( points lowered)
3) 11/13/2016 - applied for mortgage - inquiry count 3 (39 points lowered)

As you can see that last 2 inquiries were within the 2 weeks span. Why would it count separately and hurting my credit that bad?

Have to know which score in particular, never heard of an inquiry costing 39 points on a FICO model. Something else likely changed there.

How FICO should've handled it:

1) 5/24/2016 - 30 day grace period, counts as 1 inquiry on 6/24/16.

2+3) You're not past the 30 day grace period, there should be no change on either of those yet; however, from 12/1/16 onward your inquiry count will be 2.