@azguy13 wrote:
HPs will drop your score temporarily. They stay on your report for two years but are only factored into your score for a year. You will see your score start to rebound in a couple of months. However, your score may also drop, depending on how thick your file is, when your new account is reported. It will lower your AAoA which is a factor in scoring.
Hello Azguy! Very clear, helpful reply.
The only thing I might question is the thing I highlighted above. That would give the OP the impression that FICO begins to weaken the "hit" that a person takes from an inquiry after a few months. E.g. if FICO imposes a 4 point penalty initially on the score, it reduces that to a 2 or 3 point penalty after X number of months. That possibility has been discussed a number of times on the forum before, with the favorite being X = 6, but I think the consensus of the veterans is that there is no evidence for the idea that the penalty becomes (gradually) less severe over time. Rather, if a particular inquiry is going to affect you, it happens by the next day, and whatever damage it does is constant for the full 365 day period, after which the damage vanishes completely.
When a score appears to begin to rebound, that can be the result of a number of things. The simplest is age. During those few months the person's accounts were getting older. They would have been getting older at the same rate iif the inquiry hadn't happened, and therefore the person would have seen the same score increase (if one occurs).
