Hard Inquiries

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6 posts
me08053
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Hard Inquiries

Postby me08053 » Sun Feb 03, 2013 10:32 pm

I've recently applied for and been approved for both the Marriott Rewards Visa Signature and Pen Fed Platinum Rewards cards within about two weeks of each other. I realize that this means I have 2 hard inquiries on my credit report that will affect my score for 6 months and stay on my report for a year.

At the end of the 6 month period does my credit score automatically go back up to what it was before the hard inquiries or is there a waiting time or does nothing happen? Didn't know what the turn around time was and how numerically it would reflect in my score. I read that the average hit is 11 points per an inquiry. Hoping to get my 22 points back asap.

I don't carry balances etc the cards just made sense for the rewards. Thanks!


Bksuper
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Postby Bksuper » Sun Feb 03, 2013 10:39 pm

They (the inquiries) will no longer be factored into your score after 6 months, but you probably won't have the same score as before because of the many other variables that change with time.

Also, they will stay on your report for 2 years, not 1.
Sole Ownership Cards:
1st Financial Bank Platinum Student Visa, $500 CL, Open Since 3/2012
Citi Forward Student Visa, $6k CL, Open Since 10/2012
Costco TrueEarnings Amex, $6k CL, Backdates to 1/2012
SallieMae Rewards Barclay Mastercard, $2.5k CL, Open Since 4/2013
Jointly Owned Cards (co-owner with mom, not AU, used and paid only by me):
Chase Amazon Rewards Visa Signature, $2k CL, Open Since 8/2012
US Bank Cash+ Visa Signature, $13.5k CL, Open Since 10/2012
Authorized User (Parents Pay/Use)
Costco TrueEarnings Amex $29.4k CL, AU since 11/2012

me08053
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Location: Philly Area

Postby me08053 » Mon Feb 04, 2013 8:13 am

Bksuper wrote:They (the inquiries) will no longer be factored into your score after 6 months, but you probably won't have the same score as before because of the many other variables that change with time.

Also, they will stay on your report for 2 years, not 1.



Not the same score meaning higher? Due to extended length of credit history etc? Pending 0 balances etc.

Bksuper
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Postby Bksuper » Mon Feb 04, 2013 8:26 am

That depends. If these were not your first cards, then not only did getting them put on inquiries which hurt your score, but it reduced your AAOA, which also hurts your score. Depending on how old the other hypothetical accounts were/are and how many you had to dilute the new accounts influence on your AAOA, your AAOA may still be lower after 6 months than before getting the 2 new cards. Obviously, it will be higher than it is at this moment, but if you had long credit history with few accounts before adding 2 new cards and already had 100% on time payments, low (<10% Debt Utilization), and no derogatory marks, then your score could still be lower even without the inquiries. Of course, the fact that you have more accounts boosts your score, just not enough to offset the worst case scenario reduction in AAOA on its own. However, if you had moderate or high debt utilization before, and the new credit got that into the right range, then your score could be higher even now with the inquiries still factored in and the AAOA dramatically reduced, than it was before getting the new credit.
Sole Ownership Cards:
1st Financial Bank Platinum Student Visa, $500 CL, Open Since 3/2012
Citi Forward Student Visa, $6k CL, Open Since 10/2012
Costco TrueEarnings Amex, $6k CL, Backdates to 1/2012
SallieMae Rewards Barclay Mastercard, $2.5k CL, Open Since 4/2013
Jointly Owned Cards (co-owner with mom, not AU, used and paid only by me):
Chase Amazon Rewards Visa Signature, $2k CL, Open Since 8/2012
US Bank Cash+ Visa Signature, $13.5k CL, Open Since 10/2012
Authorized User (Parents Pay/Use)
Costco TrueEarnings Amex $29.4k CL, AU since 11/2012

MemberSince99
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Postby MemberSince99 » Mon Feb 04, 2013 12:19 pm

It probably sounds confusing, but what Bksuper says is right on the money. It's really difficult to say exactly what the effect is, but with proper use your score will only go up with time.

me08053
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Location: Philly Area

Postby me08053 » Mon Feb 04, 2013 1:57 pm

I think I got it. I hadn't considered the dilution of the account ages.

I have:
Amazon Visa $3600 (2006)
Chase Freedom $8000 (2007)
Express $940 (2006)
Target RedCard $600 (2009)

Two new were:
Marriott Rewards Visa Signature $23,400 (Jan 13)
PenFed Platnium Rewards $15,000 (Jan 13)

My Fico said I was at a 793 for Equifax prior to the two cards. I am assuming I can expect a 22 point deduction for the two inquiries. I fall into the category of no debt on cards, no late payments, no derogatory marks. It will be a flip of the coin as to if tripling my credit can offset two inquiries and a dilution of my AAOA. Thankfully, I still won't dip below the "Great loan rates" category, but I was super close to 800, only thing holding me back was a student loan that will eventually fall into the "35% of principal paid off" category.



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