How to Remove Credit Inquiries

How Important is the Removal of Inquiries?
Many people tend to over focus on removing inquiries when their reports are full of lates pays, collection accounts or even a bankruptcy. In these cases, you might want to save efforts to remove inquires until later. Here are more of our thoughts  on when in the credit repair process you should start working on removing inquiries.

How do You Get Inquiries?
Every time you apply for credit and the credit grantor checks your credit report, a credit inquiry is placed on your file. Even if you receive a credit offer in the mail and you respond, your credit will almost certainly be checked and a credit inquiry will be added to your credit report.

Types of Inquiries:

• Hard pull inquiries occur when you applied for new credit, like a credit card, submitted a loan application for a car or home. Hard Pull Inquires can affect your credit score.
• Soft Pull inquiries occur when an existing credtior pulls your credit to see what your credit situation is. Soft Inquiries also occurs when you pull your own credit report. Soft inquiries DO NOT affect your credit score.

Why does an inquiry affect your credit score?

• Credit inquiries are bad because too many of them can indicate to a creditor that you're "credit hungry" and may be in financial trouble.
• Worse yet, the creditor has reason to believe that you received many of the credit lines that are showing as inquiries, and that many of those credit lines have not yet appeared on your credit report.
• Too many recent inquiries indicate to a potential credit grantor that your debt-to-income ratio may be much higher than you say.

Step-by-Step Procedure for Removing Inquiries

All credit inquiries should come off your credit report after two years. If you're not willing to wait, you may take these steps:

Step 1

First, find out which credit inquiries are getting in your way. Order all three of your credit reports. When your reports arrive, look toward the end of your credit report to find the inquiries. Some of the inquiries are only promotional and will not be shown to prospective credit grantors. You need not worry about those. Identify only the inquiries that are shown to credit grantors. You should recognize some of these as places where you applied for credit, but others may be a complete mystery to you.

Step 2Find the addresses for each credit inquirer. Your Experian credit report will list addresses for each. Your Trans Union and Equifax reports will not include addresses. Match your Experian with your Trans Union and Equifax reports. You should be able to use the same addresses on the inquirers that are listed on Experian. If some of the inquirers don't show up on Experian but do show up on either Trans Union or Equifax, you will have to call the credit bureau to get their address. It is almost impossible to get a live body on the telephone at Trans Union, but Equifax has an 800 number listed at the top of their reports. If you have a inquirer on your Trans Union and you can't reach Trans Union by phone, you might try calling the 800 directory (1-800-555-1212) and request the 800 number for the inquiring creditor.

Once you have collected all of the addresses for each inquiring creditor on each credit report, you are ready for step three.

Step 3Prepare letters to each inquiring creditor asking them to remove their inquiry. The Fair Credit Reporting Act allows only authorized inquiries to appear on the consumer credit report. You must challenge whether the inquiring creditor had proper authorization to pull your credit file.

Step 4

Some of your creditors may provide documentation that a credit inquiry was authorized by you. Read the authorization that you signed very carefully. If there is any ambiguity, you can write back and argue that the inquirer's authorization form was too complicated and not easily understood by the layman. You can threaten to contact the State Banking Commission and complain about a deceptive and unclear authorization form if they don't remove your inquiry.

Some creditors will try to ignore your challenge. Be sure to send each letter Certified Mail Return Receipt Requested and keep close track of the time that you sent the letter. If the inquiring creditor doesn't respond within about thirty days, you will have ample grounds to call the inquiring creditor and demand some action. At that point, it's almost irrelevant whether or not you authorized the inquiry. Now the issue becomes the creditor's lack of response to a consumer dispute. Be sure to hold your ground. Demand that the inquiry be removed immediately or you will complain to the State Banking Commission or similar authorities.

Many of your inquiring creditors may simply agree to delete the inquiry as a courtesy or because they cannot (or will not) verify your authorization. That is the goal. Remember, it is not likely that you will need all of your credit inquiries removed -- just enough of them to keep you from being denied credit.