Inquiries are a most perplexing subject. While the FCRA addresses inquiries, if you read the details there is a lot about inquiries that is not in the law.
The Law
http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=15&sec=1681g
Addresses how long inquiries are required to remain.
http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=15&sec=1681b
Defines permissible purpose.
http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=15&sec=1681c
Cites how long adverse information can remain.
What The Law Says
The inquires required to be reported under FCRA are soft inquiries.
"Every consumer reporting agency shall, upon request, and subject to section 1681h(a)(1) of this title, clearly and accurately disclose to the CONSUMER"
FCRA does not require hard inquiries to be reported. Ever. Hard inquiries are a creation of the credit industry. CRAs report them, and FICO dings you for them.
Hard Or Soft
A CRA could code all inquiries as soft and delete them after a year--except for inquiries made for employment purposes that must stay for 2 years. However, very few OCs would pull that CRA because OCs want the maximum number of subprimes possible.
Another CRA could code all inquiries as hard and leave them for 7 years. They would get a lot of business from OCs, but they would also get many consumer lawsuits and evoke the wrath of Congress.
The consumer is at the mercy of the credit industry--until you sue.
CRAs
TU lies on consumer credit reports when they claim inquiries are "non-disputable unless you are a victim of fraud and believe an inquiry is due to fraudulent activity.”
Even if you are a victim of fraud, inquiries by law must remain. Whether they are coded as soft or hard is entirely at the whim of the CRAs, and that is the bit of "relief" one is granted by the CRAs--unless you get the CRA on negligent or willful noncompliance.
http://caselaw.lp.findlaw.com/casecode/uscodes/15/chapters/41/subchapters/iii/sections/section_1681n...
http://caselaw.lp.findlaw.com/casecode/uscodes/15/chapters/41/subchapters/iii/sections/section_1681o...
http://www.ca11.uscourts.gov/opinions/ops/200416428.pdf
EX's statement on consumer credit reports is a good synopsis about the industry approach to hard inquiries.
"The section below lists all of the companies that have reviewed your credit history as a result of an action you took, such as applying for credit or financing or as a result of a collection."
Creditworthiness
The credit industry claims when you request credit that those inquiries need to be shown to potential creditors in order to evaluate your creditworthiness. Let us accept that for the moment.
One can "car shop" or "mortgage shop" accumulating a bunch of inquiries within a window, and that bunch of inquiries is supposed to count as one. Why is it that one cannot "credit card shop"?
You car shop to qualify for the best deal you can get.
You mortgage shop to qualify for the best deal you can get.
You credit card shop, well duh, to qualify for the best deal you can get.
To the credit industry you are an undesirable because you are credit card shopping. Could not possibly have anything to do with the fact that the credit industry makes a huge amount of money off fees and interest, and I suspect a disproportionately large share of that money is made off subprimes--the most is taken from those with the least.
Cars and CCs
Let us delve a little deeper into these analogies. You show up at the Chevy dealer interested in a car, but you are not sure which one.
You tell them you are interested in the Impala, so they pull your credit. They come back and say, sorry, for what you want to put down, we cannot finance an Impala for you.
OK, fine. How about the Malibu? They pull your credit again, but they cannot finance it for you either.
OK, well, how about the Cobalt? Pull your credit again, and yeah we can do that. Here are your terms. Hmmmmmmm. Don't like those very much.
So you head off to the Ford dealer to get your credit pulled a bunch more times.
Ten credit pulls in all later, you head home with a new Dodge Caliber. Oh, and those ten credit pulls are not all grouped together as one inquiry. It is ten inquiries.
That is what it is like when you go credit card shopping. You get stung with an inquiry by each company (Chase, CITI, BOA, WAMU, etc.) and you get stung for each product for which you try to get credit approval. Sometimes you luck out when you apply for more than one CC from the same company all in the same day--like with AMEX.
CAs
CAs with a legit collection have PP to pull your CR. See James v. Interstate (and many others).
http://www.paed.uscourts.gov/documents/opinions/05D0902P.pdf
But should they be hard or soft inquiries? I do not know. There is no caselaw as there is no FCRA violation for hard versus soft inquiries. There is PP or there is no PP.
Since there are no statutes to assist, you have to find the CA or the CRA in violation of something else in order to leverage them into changing a hard to a soft.
Sidebar: If you ever do catch a CRA in a violation, along with a demand for monetary damages in your ITS letter, you can legally demand, and they can legally assent to your demand, to recode all your inquiries as soft and delete all inquiries over 12 months old. It's a negotiation. You could demand a date with Jennifer Garner, but you might or might not get it. [I'm betting against the date, but feeling pretty good about the inquiry delete if the violation is likely to be costly for the CRA.]
I cannot figure this out. OK, the credit industry claims they need to know when you are applying for credit to help them determine your creditworthiness, right? Then what is the purpose behind a CA pulling a hard inquiry other than kicking someone while they are down?
Nothing under law I know of prevents a CA from pulling your CRs every day. However, you could probably get them on defamation and willful injury.
What if they pulled only every other day? Probably still amounts to defamation and willful injury.
Once a week? I am going with defamation and willful injury.
Once a month? Still going with defamation and willful injury.
Once every couple of months? At some point, the courts are going to find some "frequency of acceptability" wherein a CA can pull a hard INQ. Want to be the test case?
Conclusion
It's no surprise there are "grey approaches" out there to deleting inquiries one cannot speak of on MyFico forums, but that should serve as a wake up clue to the credit industry.
If 85% of the drivers along a stretch of highway are consistently exceeding the speed limit, and there's no underlying safety hazard or concern why the speed limit should be set artificially low, then it's a case of an artificially low speed limit (likely there to raise revenue) and not a case of unethical, speed-crazed drivers.
When a lot of consumers are doing things considered "unethical" to repair their credit, maybe that's a sign the game is rigged a bit too well for the house.
I stumbled upon yet another of the grey approaches in my reading earlier today. Theory being that one can sue the CA over a hard inquiry by claiming no PP as the CA has a certificate with the CRA to pull under 1681b(a)(2) or 1681b(a)(3)(A), but not under 1681b(a)(3)(F)(ii).
Might be some valid legal standing behind it. I do not know. Seemed plausible till I read James v. Interstate. Now I am a bit less convinced. There are supposed to have been some settlements, but no caselaw thus far. It could be the JDBs and CAs fear caselaw on this one as much as they fear a final opinion on Guerrero.
