Question
Dear Credit Card Adviser,
I just read the article by Pat Curry on how credit scores are calculated. It helpfully answers many issues, but I would appreciate getting an answer to the following question:
The writer lays out a number of factors that are included in the credit score calculation and also identifies factors that are not included. The writer makes clear that inquiries made to credit bureaus in connection with applications for credit are factored into a credit score. I would like to know whether routine inquiries made to credit bureaus by lenders (often on a frequent basis) to review a borrower's credit report are included as a factor in calculating the borrower's credit score. In other words, are inquiries that do not involve applications for new credit taken into account when a credit score is calculated?
-- Jonathan
Answer
Dear Jonathan,
Sometimes credit checks not triggered by an application for credit may still generate the kind of inquiry that can influence your credit score. All recent credit inquiries appear on your credit report, but only "hard" inquiries or pulls appear to creditors and affect your score. "Soft" inquiries do not impact your credit rating.
"The general rule is if it is an inquiry that indicates that you may be taking on additional financial obligations (it can impact your score), because that could be meaningful to your risk of being able to repay other debts," Maxine Sweet, vice president of public education for Experian, says in an article on Bankrate.com.
