Feb
29
2012

Inquiries for multiple car loan applications cannot be removed

Dear Experian,

While looking for a new car the auto dealer shopped the best rate for a loan, generating seven or eight hard credit inquiries, which have dropped my score. Can I have these hard inquiries removed?

- DRL

 

Dear DRL,

Because the law requires that your personal credit report list all organizations that have requested it, the inquiries cannot be removed.

However, most credit scoring systems allow people to shop for the best rates on car loans without having any significant negative impact on their credit scores. Today, credit scoring systems count all inquiries for auto loans within a given period of time, usually around 14 days, as a single inquiry.

Car dealerships often send your application to multiple lenders at the same time in a process called “shotgunning” to find the best loan terms. As a result, lenders compete for the loan and the consumer benefits by getting the best rates and finance terms available to them.

If the drop in your score was in fact due to the loan application with the auto dealer, it should have had the same impact, whether there were eight inquiries or just one.

It is also important to be aware that the impact of inquiries decreases over time, so your credit scores should rebound fairly quickly, assuming there are not other issues with your credit history.

Thanks for asking.

- The “Ask Experian” team

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