Your credit score affects your ability to get financing for a new car or to purchase a home. Some of the factors that are considered include your income, existing debt balances, late payments and recent inquiries for new credit accounts. Whenever you apply for a new credit card, auto loan, credit line or other type of loan, an inquiry is noted on your credit report. Learning how these inquiries impact your credit score can help you keep an eye on your credit report in the future.
Impact of Credit Inquiries
Having numerous inquiries on your credit report can lower your credit score. The inquiries alone can have an impact even if you do not actually accept any of the credit offers. Numerous inquiries in a short time may mark you as a high risk for lenders, because it can signal you are taking on too much credit for your income level. A lender may worry that you have actually opened the accounts, even if they have not shown up on your credit report yet.
How to Look up Your Credit Inquiries
Credit inquiries normally stay on your credit report for two years. You can request one free credit report each year to review the items included in your credit score calculation. There are three major agencies that contribute to these reports are Experian, Equifax and TransUnion. AnnualCreditReport.com is the official source to obtain your free annual report. Be wary of other websites that claim to be free but require a credit card number or a trial membership in their credit protection services.
Removing Unauthorized Inquiries
There is no way to have authorized inquiries removed before the two-year time period expires. However, if you think an inquiry was made without your permission, the Fair Credit Reporting Act allows you to request its removal. Check your credit report for the creditor's address, and send a letter asking for proof of authorization. If the creditor responds that it was not authorized, send a copy of this response to the three major credit reporting agencies along with a request to remove the inquiry. Check your credit report in 30 days to see if it has been updated. In some cases, the creditor will just remove the inquiry instead of taking the time to respond to your request for proof.
Inquiries That Do not Affect Your Credit Score
Information-only inquiries, also known as soft pulls, are not included in your credit score. This allows you to order copies of your credit report and lenders to purchase and use your credit information for marketing purposes. Some hard-pull inquiries also are eliminated when calculating your credit score. For example, multiple inquiries in a short period of time for the same auto loan, home mortgage or student loan are combined into one. This allows you to shop around for the best interest rate on a loan without harming your credit.
Denise Sullivan has been writing professionally for more than five years after a long career in business. She has been published on Yahoo! Voices and other publications. Her areas of expertise are business, law, gaming, home renovations, gardening, sports and exercise.