The whole inquiries thing....

[Anonymous]

I've read on the board that inquiries lose their impact after 6 mos.  I'm asking because my credit spree will be 6 mos old next month.  If they don't have an impact after 6 mo., then why do they remain on your CR for 2 yrs.  My max no on one of the bureaus is 9 but 2 due to drop off in OCTOBER.  I'm only curious so please and thank you.

[IncrsCreditScore1]

Brian, the notes I have made concerning inquiries indicates that after an inquiry is one years old, it substantially loses it's impact. 

If I have read and noted incorrectly will someone please post the correct information.

[Anonymous]

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@IncrsCreditScore wrote:

Brian, the notes I have made concerning inquiries indicates that after an inquiry is one years old, it substantially loses it's impact. 

If I have read and noted incorrectly will someone please post the correct information.

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That is my understanding, too. In fact, my TransUnion only has the inquiries from this year. They dropped the rest. I don't know why, but I am happy.

[IncrsCreditScore1]

Glad to hear that is your understanding, too, Musiclover.

[Anonymous]

I know that if you have more than 1 inquiry under 6 months that there is NO points gain when one of them ages over 6 months. I specifically watched as an inquiry aged over 6 months and NOTHING happened to my score. That said I still had two other inquiries under 6 months so it's possible that there's a step-function, that I'll see some benefit when ALL inquiries age over 6 months. 

But if you have 3 inquiries under 6 months and 1 ages over 6 months I can tell you from watching my own score--nothing happens at 6 months in that case.

[RobertEG]

The CRAs feel that their customers want to see inquiry history on consumers for two years, after which they have diminished use.

Creditors are then free to use or ignore them.  The CRAs could retain longer, but real-world economoic factors, such as the high cost of data storage of millions and millions of inquiries, enters the picture.  The same ecomonic factors that lead CRAs to delete old accounts that have been closed for approx 10 years.

If/when a CRA deletes earlier is most likely due to data base space needs, and not and creditor disinterest in the info or any credit scoring consideration.

FICO takes a more academic view, first determining how long inquiries continue to have statistical risk-predictive value in correlating with risk of default in payments.

Their data leads them to the conclusion that their risk-predictive value has a life span of approx one year.

How much the FICO algorithm actually begins to discount the scoring effect, such as at 6 months, is not something I have seen them publish, as they must preserve the proprietary nature of their trade secrets.... only that they cease scoring after one year.

Differing views and differing needs.

[Anonymous]

To summarize....

After one year, the FICO impact of an inquiry is zero.  Not "substantially less" but actually no impact of any kind.

Between six months and one year, there is no published statement from FICO that implies the impact becomes less than it was (say) on day 3.  Some people here on the Forum have tried looking to detect whether FICO impact becomes less at month 6 (using their own profiles) but haven't been able to see that.

[Anonymous]

So I applied for 3 secured credit cards today, will those put a negative impact? My scores are different from a paid my free credit report Equifax 543, and then when I used credit check total 10 minutes later Equifax one said it was 504!! 

[Anonymous]

Yes.  Inquiries hurt your score initially and for the following year.  After that, an inquiry ceases to have any impact..  In your case, that was three inquiries, all counted seperately, all having an impact.

Were you approved for the three cards you applied for?  If you did, then you will (or already have been) been hurt in another way.  Actually adding a brand new tradeline damages your score as well.  The good news is that eventually you will come out ahead (the benefit to your score from having three credit cards will be be less than the damage done to your score initially).

I encourage you to educate yourself about how FICO scores work.  The link at the very top of the screen (LEARN ABOUT SCORES) is one place to start.

Do you have any credit cards besides the three you applied for?  And were you approved for the three you mentioned?  And do any of them have an annual fee?

[Revelate]

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@Anonymous wrote:

I know that if you have more than 1 inquiry under 6 months that there is NO points gain when one of them ages over 6 months. I specifically watched as an inquiry aged over 6 months and NOTHING happened to my score. That said I still had two other inquiries under 6 months so it's possible that there's a step-function, that I'll see some benefit when ALL inquiries age over 6 months. 

But if you have 3 inquiries under 6 months and 1 ages over 6 months I can tell you from watching my own score--nothing happens at 6 months in that case.

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I'll look for this specifically in sixish months again however I'm unconvinced that there's any aging involved in inquiries at all and at this point strongly suspect it's just an aggregate calculation for any inquiry in the scorable window of 1 year from current date.  To my knowledge it is just a step-function without a time factor shorter than the 1 year exclusion, and that corresponds with other testing data from a while back that other people did.  I never really get enough inquiries to really strenously test that but it's held in my small inquiry count range too.

Data point recently on FICO Beacon 5.0 while mortgage hunting:

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Beacon-5-0-3-gt-2-gt-3-gt-2-inquiries/m-p/4160538#U4160538