Disputing inquiries is not worth the potential pitfalls

[hegemony]

Disputing inquiries is not worth the potential pitfalls.

 

Most people who pursue this unwise course of action generally comment they want to do so to improve their FICO scores. While that is a laudable goal you need to keep in mind the very small portion of FICO comprised by "seeking new credit" (i.e., inquiries). Also, seeking new credit is 50% of credit repair. Failure to add new tradelines is one of the main mistakes many people make when they start credit repair.

 

Inquires can affect FICO scores, but the extent to which they do is relative to your credit report information (e.g., thickness) as well as the type of inquiry in a given time period. Moreover, the primary effect of inquiries on FICO is in the first 6 months following the inquiry. Between 6 and 12 months an inquiry barely affects FICO. After 12 months, while the inquiry may remain on your report, it has ZERO effect on FICO scores. Inquiries are not derogatory items.

 

It is true that some people are rejected for credit based on too many inquiries even if the inquiries are over 12 months old. In my opinion, if the inquiries were not present, the creditor would merely provide a different adverse action reason to the consumer.

 

Another myth many people believe in is more inquiries means lower scores. Again, the effect of inquiries will to a great extent be a function of your credit profile in toto. I've seen a single inquiry not affect a FICO score at all. Moreover, when a consumer has > 5 inquiries in a 6 month period the effect is the same. In other words, 6 or 600 inquiries are scored the same.

 

In the case of inquiries that were made without permissible purpose, you need to worry about two things. First, you need to read the FCRA and learn about the potential $1000 in damages that can be levied for anyone who accesses your credit report without permission. Second, you need to worry about fraud in the event someone is trying to open credit using your report. The proper way to deal with inquiries from fraud is to invoke fraud alerts and the procedures in place by the four major CRAs to deal with such situations. Become an educated consumer on this issue and learn what a non-permissible purpose letter is and when to send it as well as how to deal with potential fraud.

 

If there is permissible purpose (e.g., you applied for credit, the inquiry is from a current creditor, or the inquiry is from a legitimate holder of your debt) you need to understand the multiple pitfalls of disputing such inquiries.

 

Here are sum of the pitfalls:

 

1) If you dispute an inquiry from a creditor that opened an account, you risk having the account closed by the creditor. Think of it this way, if you are a credit card issuer and the CRA informs you that consumer A disputes an inquiry made by your firm could that mean the tradeline opened as a result of that inquiry is fraudulent? While this is rare, it is perhaps the greatest pitfall of disputing inquiries.

 

2) Many people who dispute inquiries find a fraud alert is placed on all four major credit reports. A fraud alert in and of itself is not always bad, but it can be a pain to deal with -- especially if you are trying to open new credit.

 

3) There is an opportunity cost of such disputes. In short, more people have larger dragons to slay. Your time is better spent addressing derogatory tradelines, public records, and utilization.

 

Lastly, given the probability of bumpage on TU and EQ, inquiries should be the last of your concerns.

Edited March 7, 2008 by hegemony

[elFloyd01]

Thank you!

[scarykarrey]

I've been lurking around these forums for a while and obsessively reading the Newbies section, and haven't really found a cut-and-dry answer to this question:

 

At what point in the credit repair process should I start trying to open up new lines of credit? I'm not very far into the process, although I've already raised my FICO score by 83 points. Should I start when I reach a certain score? Or when I reach a certain goal of how many baddies I've gotten removed?

[hegemony]

I've been lurking around these forums for a while and obsessively reading the Newbies section, and haven't really found a cut-and-dry answer to this question:

 

At what point in the credit repair process should I start trying to open up new lines of credit? I'm not very far into the process, although I've already raised my FICO score by 83 points. Should I start when I reach a certain score? Or when I reach a certain goal of how many baddies I've gotten removed?

well there is no cut-n-dry answer. 83 points is wonderful progress!

 

Have you looked into a secured card? There are high fee cards that cater to scores in the high 500s to low 600s, such as orchard. Such cards can be an OK option as long as you understand what you are getting into. Cards like first premier, continental, etc should be avoided. Compared to them orchard is cheap.

[scarykarrey]

Well, I'm not quite to the high 500s yet, but maybe once my first round of disputes and PFDs goes through I'll make it up there. Currently, my only open credit card is an old Capital One platinum one that I haven't managed to get charged off yet, with a $550 limit. I'm paying it down currently, and hope to have a $0 balance on it soon. My poor $1800 C1 platinum got charged off last year.

[InsultComicDog]

 

Personally, I think inquiries are the least of credit scoring problems to be worried about.

[CrapOneSux]

On my EX report, my utilization is through the roof due to my COs, my balances dropped some from last month, and nothing else has changed on it except my number of inquiries going from 4 to 6. My score went from 595 to 605, the first time it's broken 600 in over a year. My file isn't very big either. Considering that, I'll vouch for them not mattering much scorewise. There are bigger things to worry about, like everything else. Just use common sense and good judgment when applying for credit.

[theshoediva]

Disputing inquiries is not worth the potential pitfalls.

 

Most people who pursue this unwise course of action generally comment they want to do so to improve their FICO scores. While that is a laudable goal you need to keep in mind the very small portion of FICO comprised by "seeking new credit" (i.e., inquiries). Also, seeking new credit is 50% of credit repair. Failure to add new tradelines is one of the main mistakes many people make when they start credit repair.

 

Inquires can affect FICO scores, but the extent to which they do is relative to your credit report information (e.g., thickness) as well as the type of inquiry in a given time period. Moreover, the primary effect of inquiries on FICO is in the first 6 months following the inquiry. Between 6 and 12 months an inquiry barely affects FICO. After 12 months, while the inquiry may remain on your report, it has ZERO effect on FICO scores. Inquiries are not derogatory items.

 

It is true that some people are rejected for credit based on too many inquiries even if the inquiries are over 12 months old. In my opinion, if the inquiries were not present, the creditor would merely provide a different adverse action reason to the consumer.

 

Another myth many people believe in is more inquiries means lower scores. Again, the effect of inquiries will to a great extent be a function of your credit profile in toto. I've seen a single inquiry not affect a FICO score at all. Moreover, when a consumer has > 5 inquiries in a 6 month period the effect is the same. In other words, 6 or 600 inquiries are scored the same.

 

In the case of inquiries that were made without permissible purpose, you need to worry about two things. First, you need to read the FCRA and learn about the potential $1000 in damages that can be levied for anyone who accesses your credit report without permission. Second, you need to worry about fraud in the event someone is trying to open credit using your report. The proper way to deal with inquiries from fraud is to invoke fraud alerts and the procedures in place by the four major CRAs to deal with such situations. Become an educated consumer on this issue and learn what a non-permissible purpose letter is and when to send it as well as how to deal with potential fraud.

 

If there is permissible purpose (e.g., you applied for credit, the inquiry is from a current creditor, or the inquiry is from a legitimate holder of your debt) you need to understand the multiple pitfalls of disputing such inquiries.

 

Here are sum of the pitfalls:

 

1) If you dispute an inquiry from a creditor that opened an account, you risk having the account closed by the creditor. Think of it this way, if you are a credit card issuer and the CRA informs you that consumer A disputes an inquiry made by your firm could that mean the tradeline opened as a result of that inquiry is fraudulent? While this is rare, it is perhaps the greatest pitfall of disputing inquiries.

 

2) Many people who dispute inquiries find a fraud alert is placed on all four major credit reports. A fraud alert in and of itself is not always bad, but it can be a pain to deal with -- especially if you are trying to open new credit.

 

3) There is an opportunity cost of such disputes. In short, more people have larger dragons to slay. Your time is better spent addressing derogatory tradelines, public records, and utilization.

 

Lastly, given the probability of bumpage on TU and EQ, inquiries should be the last of your concerns.

 

You know its interesting that you share this, because in reading myFico reports it has on the page where there's the scale that shows what's hurting and helping your score. Hurting being in red and helping being in green. One of the things that was hurting my score was that I didn't have any new accounts.

 

Well, I sure did take care of that this weekend now that my scores are up. But there may be something to what you are sharing here. At first blush I just thought you were being a cynic. But nah, I'm a believer.

 

Plus, too, the daily pulls becomes a chore in and of itself, too cumbersome. I have letters to write, green cards to collect, and folks to call. I'm on a MISSION!!!

[geeharry]

This is great info. Thank you. I have for awhile moved my priorities elsewhere towards playing the dispute game, but I do have some questions below.

 

If there is permissible purpose (e.g., you applied for credit, the inquiry is from a current creditor, or the inquiry is from a legitimate holder of your debt) you need to understand the multiple pitfalls of disputing such inquiries.

 

When you say "legitimate holder of debt", does this include CAs that bought the account but have not contacted you? Meaning, is this part of the investigative process for the CA to be allowed to do an inquiry or must they actually have a listed account on your file for them to pull it?

 

 

Lastly, given the probability of bumpage on TU and EQ, inquiries should be the last of your concerns.

 

TU stopped me from accessing my account and EQ hasn't created *b* as far as I can see over these past 4-5 months. Does *b* still work with EQ?

Edited March 7, 2008 by geeharry

[hegemony]

This is great info. Thank you. I have for awhile moved my priorities elsewhere towards playing the dispute game, but I do have some questions below.

 

If there is permissible purpose (e.g., you applied for credit, the inquiry is from a current creditor, or the inquiry is from a legitimate holder of your debt) you need to understand the multiple pitfalls of disputing such inquiries.

 

When you say "legitimate holder of debt", does this include CAs that bought the account but have not contacted you? Meaning, is this part of the investigative process for the CA to be allowed to do an inquiry or must they actually have a listed account on your file for them to pull it?

 

It can, but if they pull you need to make them PROVE they own the debt with a limited DV, non-PP letter.

 

Lastly, given the probability of bumpage on TU and EQ, inquiries should be the last of your concerns.

 

TU stopped me from accessing my account and EQ hasn't created *b* as far as I can see over these past 4-5 months. Does *b* still work with EQ?

 

How did TU prevent access? Do you mean TC?

 

B* is alive and well on EQ

[dd7]

Hege:

 

I now have 3 inquiries on my EX file, from Chase, Amex, and Macys/DSNB. The first two are cool because I was appoved for those cards, but my request for a Visa upgrade was denied by DSNB (I have had my regular, Funky Macy's card since 1990. lol!). My hope is to apply for the Nordstrom Visa near the end of this year, and I know they're inquiry-sensitive.

 

Given that I already had the Macy's card, should I contest their inquiry to make room for Nordstrom?

 

Thanks.

[hegemony]

Hege:

 

I now have 3 inquiries on my EX file, from Chase, Amex, and Macys/DSNB. The first two are cool because I was appoved for those cards, but my request for a Visa upgrade was denied by DSNB (I have had my regular, Funky Macy's card since 1990. lol!). My hope is to apply for the Nordstrom Visa near the end of this year, and I know they're inquiry-sensitive.

 

Given that I already had the Macy's card, should I contest their inquiry to make room for Nordstrom?

 

Thanks.

IMHO, no. depending on when "the end of the year" is the three inqs you cite will be over 6 months old.

 

what makes you think nordy's will pull ex?

[Xecuter2]

Given that I already had the Macy's card, should I contest their inquiry to make room for Nordstrom?

...YOUR request was denied...

Edited March 8, 2008 by Xecuter2

[GoArsenal]

THIS NEEDS TO BE A STICKY IN THE NEWBIE THREAD.... The maybe, just maybe the, "Dude, how do I delete legit inquiries?" question will stop being asked.

 

Great post.

[dd7]

Hege:

 

I now have 3 inquiries on my EX file, from Chase, Amex, and Macys/DSNB. The first two are cool because I was appoved for those cards, but my request for a Visa upgrade was denied by DSNB (I have had my regular, Funky Macy's card since 1990. lol!). My hope is to apply for the Nordstrom Visa near the end of this year, and I know they're inquiry-sensitive.

 

Given that I already had the Macy's card, should I contest their inquiry to make room for Nordstrom?

 

Thanks.

IMHO, no. depending on when "the end of the year" is the three inqs you cite will be over 6 months old.

 

what makes you think nordy's will pull ex?

Well, I live in Ohio. Do they not exclusively pull EX here? I don't know. I only assume. My other two are clear of inquiries and have the higher scores. BTW//the end of the year for me will be around November. The inquiries are from 09/07 (Macy's), 12/07 (Chase Freedom), and 03/08 (Amex).

[geeharry]

How did TU prevent access? Do you mean TC?

 

B* is alive and well on EQ[/b]

 

 

Oh yes, my bad. TC prevented access. But I've been pulling EQ almost everyday and nothing has dropped from either EQ nor TU.

 

I agree in the long run that there are more important things to take action on rather than going after deleting inquiries. But I do say this info as originally posted was very informative for me.

[dd7]

Given that I already had the Macy's card, should I contest their inquiry to make room for Nordstrom?

...YOUR request was denied...

? What request? You mean, to delete the inquiry?

[dd7]

Where u at, Hege? Show your Siggy.

[chemmastr]

THIS NEEDS TO BE A STICKY IN THE NEWBIE THREAD.... The maybe, just maybe the, "Dude, how do I delete legit inquiries?" question will stop being asked.

 

Great post.

 

Have to get people to read the section first!

Edited March 8, 2008 by chemmastr

[sfbehr]

Thanks, Hege! Very well stated!

 

I agree that this would be a very worthy sticky for the credit forum, since this is an issue that always comes up.

[goldtrad]

How did TU prevent access? Do you mean TC?

 

B* is alive and well on EQ[/b]

 

 

Oh yes, my bad. TC prevented access. But I've been pulling EQ almost everyday and nothing has dropped from either EQ nor TU.

 

I agree in the long run that there are more important things to take action on rather than going after deleting inquiries. But I do say this info as originally posted was very informative for me.

 

 

Pulling EQ as in Credit Watch Gold? No wonder why b ain't happening. U gettin' C. Drop CWG and get a daily puller or three.

[geeharry]

How did TU prevent access? Do you mean TC?

 

B* is alive and well on EQ[/b]

 

 

Oh yes, my bad. TC prevented access. But I've been pulling EQ almost everyday and nothing has dropped from either EQ nor TU.

 

I agree in the long run that there are more important things to take action on rather than going after deleting inquiries. But I do say this info as originally posted was very informative for me.

 

 

Pulling EQ as in Credit Watch Gold? No wonder why b ain't happening. U gettin' C. Drop CWG and get a daily puller or three.

 

 

Wait a minute, you're saying that I won't have *b* on CWG? That's a daily puller.

 

Well, I tried to sign up for TC again and it won't even give me the screen to call them, just options to write or get a free annual report, so I assume that's out.

 

I don't have a AMEX card so that is out.

 

Privacymatters seems too expensive at $29.95 per month and I tried doing a search for discount code but didn't see any.

 

I did however, sign up for Chase ID Protection yesterday but was thinking of dropping it because of the hard to read format and because their FAKO scores were so out of line with MyFICO (all around 40-50 pts lower). I can live with it if it does the job of *b*.

 

Opinions? Suggestions?

[partsworks]

CIDP will give you bumpage on TU and EQ, Credit Karma is free and will work for TU.

[geeharry]

CIDP will give you bumpage on TU and EQ, Credit Karma is free and will work for TU.

 

 

Thanks. Good to know.

 

What score is Credit Karma they giving you and is it FAKO? I just signed up and that score is lower than anything I have from MyFICO and I just pulled that today.

Edited March 8, 2008 by geeharry

[partsworks]

The credit karma score is fako and it means absolutely nothing.