Home : Blogs : Candace Pinaud : Candace's Blog

Does each credit report pull count AGAINST the borrower?

Most of us in the industry have been counseled that when multiple lenders, car dealers, etc. pull a clients credit report within a certain time frame that the ‘inquiry' only counts as ONE.

Recent information from the credit bureaus has enlightened us that this, in fact, is NOT the case.

There are separate systems within the credit pulling system; one is called ‘NEXTGEN'. IF your lender is using the NEXTGEN system then, yes, each inquiry pulled within the same industry within a certain time period would only count as ONE inquiry.

However, ONLY 11% of all professionals who pull credit reports in this country are on that system!!

This means 89% of the rest of us use the same system which counts EVERY INQUIRY AGAINST the borrower!

Many inquiries within a small time frame WILL pull any borrowers score down. WHY? Because it is possible that each inquiry is extending credit to that borrower and the credit score has to adjust for that fact.

This is an excellent reason to counsel your buyers appropriately and refer them to those who know how the credit scoring system functions and will not put them in harms way.

Posted by Candace Pinaud on 01/12/2008 08:48 AM

Comments (9)

credit, credit score, inquiry, inquiries, mortgage, buyers, sellers, lender, broker

9 Comments on Does each credit report pull count AGAINST the borrower?

JAN

2008

Thanks for the tip. I am always confused about what counts against a credit score.

Morning Barbara,

Thanks for commenting :-). I have been doing credit repair for years - if you want more info let me know. I have a word doc I made up that has a breakdown of what goes into credit scores.

Candace, I heard so not sure if it is true, if you are buying a home and it is pulled several times in a span of a week it doesn't rate you down. Is that true?

Morning Missy,

Nope, that's not true. That's what we have all been told - but always with a bit of skepticism as no one 'really' knew the exact truth.

The recent info I posted is from when the credit bureaus were actually taken to court and when asked 'under oath' many, many questions.....this is one tidbit that came out!

I have a three pages of other little 'tidbits' I learned as well that so many of us held as truths that aren't.

Turns out - the credit bureaus are just another 'business' trying to make money. Their primary goal is not to protect consumers but to find ways to make money to stay in business ;-).

Each time a lender pulls a credit report they get charged, hence, more money for the bureaus.

Why would it be anything different. What if the bureaus payed the individual each time the credit was pulled. I am sure Hillary Clinton will be able to fix this with 34 days,lol.

FEB

2008

Great insight. Thanks Candace.

Thanks for the comment Ken! It is sad that there isn't a better system in place to monitor the credit bureaus. We have all been under the impression that the credit bureaus are advocates for us - the consumer.

Better to think of the bureaus as the 'business' they are and always keep in mind their main goal is to make money ;-).

MAR

2008

Hi,

What if a bank does not approve you for a loan...then a month later pulls your credit report again-without asking them to?

I know my credit report was corrected causing a large jump in my score-but I did not authorize another pull. Then they sent me a letter stating my credit score was lowered because of credit inquiries.

Thanks,

Richard

HI Richard,

Thanks for the question. Ouch - that is a catch-22. Why did they re-pull it? Did they have to send it to another investor? was it the investor who pulled it directly; sometimes that happens and there is nothing that can be done about it.

E-mail directly and we can hash out what happened: candace@leavenostone.com

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?