Why do some banks and credit unions do a hard pull?

[folks19]

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@Brian_Earl_Spilner wrote:

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@folks19 wrote:

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@Anonymous wrote:

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@folks19 wrote:

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@Anonymous wrote:
https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Inquiry-Master-Thread-understanding-inquiries-and-how-the-affect/m-p/5948669/highlight/true#M167289

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I think that was helpful information in general, but it doesn't address why there would be a hard pull for a non-credit application. Most banks won't even do a soft pull for just a bank account, so why would some do a hard pull?

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That was addressed to the purpose of a hard pull, to give notice to other creditors the credit was sought, although it addresses a lot of other issues discussed as well.

I see no valid reason for a bank to do a hard pull to open a checking account unless you are seeking overdraft protection. What bank is requiring this?

If you're not seeking an extension of credit, it's not something that I would like, but they could still say they have a permissible purpose because they are establishing a relationship with you. I don't think I would like that institution very much. 

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I agree 100%. I would NOT want to have a relationship with such a FI, so thats exactly why I decided to post this question (https://ficoforums.myfico.com/t5/Personal-Finance/Does-SDFCU-do-a-hard-pull-for-membership/m-p/6084766#M197043) after reading online that they do a HP for a savings account, before I flushed them doen the toilet. (Now that I got my answer, they are far down there.) I think SDFCU is a very good credit union, but I can't join until I fully understand shy they do a hard pull for a savings account!

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Credit Unions tend to do a HP because they also offer credit products while opening the account. Even if they don't, many will allow you to open a credit product using the account opening HP.

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That is most likely the logic, but I wish they would just be a bit amarter and let people apply just for a savings or checking account without a hard pull.

If, for example, I'm interested in taking out some loan with a credit union and, I'm also looking for a FI to manage my finances, but I'm simplly not ready for the loan yet, but I do want to start with a checking account. In that case, the hard pull is harmful for that person.

[M_Smart007]

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1, TBH, now that's "Smart"

[folks19]

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@Anonymous wrote:

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@folks19 wrote:

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@Anonymous wrote:
You said bank..CUs, some conservative ones do HP, unfortunately...with those the pull is usually good for 30 days for other products,...so then you don't "waste" it, or at the same time.

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I think that is the case with SDFCU, and the truth is that I think SDFCU is a wonderful credit union (not from experience. Just from online reviews), but they do a hard pull, which I don't like. So I think I'm going to wait until I'm ready for one of their cards and then apply for the credit union and a card at the same time.

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Just bear in mind that SDFCU wants you to go to them for credit early on. If you get too much credit elsewhere, they'll deny you credit with them. 

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Thanks. That's good to know!

[folks19]

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@Anonymous wrote:
Besides, with a CU you are becoming a part owner/member. It's not like a banking relationship. But I still don't like it.

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So I totaly understand if they want to do a full background check on me before "bringing me in as a partner", but why do a hard pull?

Again, a hard pull in "advertising to the world that one is seeking credit". A hard pull is not a background check. So unless the person is seeking credit, a hard pull is not appropreate.

[folks19]

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1 Do you know if SDFCU has that option?

[randomguy1]

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@folks19 wrote:

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1 Do you know if SDFCU has that option?

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Most banks usually do. @Anonymous  might know. I do not have SDFCU. Do they have a bank bonus? 

[folks19]

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@randomguy1 wrote:

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@folks19 wrote:

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1 Do you know if SDFCU has that option?

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Most banks usually do. @Anonymous  might know. I do not have SDFCU. Do they have a bank bonus? 

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I mean to ask if SDFCU has the option of declining the overdraft line of credit and avoid the hard pull?

[Anonymous]

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@randomguy1 wrote:

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@folks19 wrote:

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1 Do you know if SDFCU has that option?

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Most banks usually do. @Anonymous  might know. I do not have SDFCU. Do they have a bank bonus? 

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I don't have them either. I got too much credit elsewhere for them to ever give me any and they're an EX2 puller too. 

The do have a PLOC that starts at 11.75% though https://www.sdfcu.org/rates

[randomguy1]

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@folks19 wrote:

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@randomguy1 wrote:

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@folks19 wrote:

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@randomguy1 wrote:

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@M_Smart007 wrote:

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@randomguy1 wrote:

Just a note, some of these financial institutions only do a hard pull when you do not decline overdraft protection.

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@randomguy1, Sure wish we had a master list of those!

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TBH, I just look on DoC and always decline overdraft. I usually have my credit locked as I'm not expecting a pull.

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@randomguy1 Do you know if SDFCU has that option?

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Most banks usually do. @Anonymous  might know. I do not have SDFCU. Do they have a bank bonus? 

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I mean to ask if SDFCU has the option of declining the overdraft line of credit and avoid the hard pull?

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Gotcha. That, I am not sure on. It looks like they are a hard pull. Your best bet is applying or asking them directly.

https://www.doctorofcredit.com/bank-accounts/is-opening-a-bank-account-a-soft-or-hard-pull/

[M_Smart007]

@AllZero, You may have to save this as a Macro

https://www.doctorofcredit.com/bank-accounts/is-opening-a-bank-account-a-soft-or-hard-pull/

Thanks to @randomguy1