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How Inquiries Impact Credit Repair

by | Jan 2, 2024 | News

Inquiries made on your credit report can influence your credit score, which in turn affects the credit repair process. There are two categories of inquiries: hard inquiries and soft inquiries.

1. Hard Inquiries:
These occur when a lender or creditor examines your credit report after you’ve applied for credit, such as for a credit card, mortgage or auto loan. Hard inquiries can have a negative impact on your credit score. However, the effect is generally small and temporary. Typically, a single hard inquiry may slightly lower your score by a few points, but its influence diminishes over time. Hard inquiries typically remain on your credit report for approximately two years. Although they may affect your score for a shorter duration, creditors can see them for an extended period.

2. Soft Inquiries:
These instances happen when you personally review your own credit report or when a creditor or lender examines your credit as part of a background check that is unrelated to applying for credit (for example, pre-approved credit offers or employment checks). Soft inquiries do not affect your credit score. Checking your own credit report or having your credit checked for non-credit-related reasons does not have a negative impact.

The Relationship Between Inquiries and Credit Repair:

Monitoring Credit Score:
While you focus on credit repair, it is essential to keep an eye on your credit score. Hard inquiries are one factor that can influence your score, so being aware of when and why they occur is crucial.

Strategic Credit Application:
If you are actively working on credit repair, it is advisable to be strategic about applying for new lines of credit. Having too many hard inquiries within a short period might be seen as a sign of financial difficulty and could have a negative effect on your credit score. It is best to be selective when seeking new lines of credit and only apply when necessary.

Challenging Unauthorized Inquiries:
If you happen to come across any inquiries on your credit report that you didn’t authorize or that are incorrect, you have the right to dispute them with the credit reporting agencies. If these inquiries are found to be unauthorized or inaccurate, they can be removed from your report. Contact a credit repair company if you need help removing inquiries or other questionable negative items from your credit reports.

To sum it up, while inquiries might temporarily affect your credit score, they are just one aspect of the bigger picture when it comes to credit repair. It’s crucial to focus on other elements of your credit report like paying bills promptly, reducing outstanding debts and rectifying any inaccuracies in order to enhance your creditworthiness in the long run.