Understanding some of the basic aspects of credit inquiry
Posted by Jacab Roy on September 24th, 2019
What is a credit inquiry? How exactly can you define a credit inquiry?
A credit inquiry report or record can be defined has the recorded inquiry every time someone (or an agency), pulls an “inquiry” of your credit history or if the agency simply gets a copy of your credit report.
It can happen under many occasions. For instance, a concerned and relevant agency can ask for your credit report if you have applied for a credit card or a loan.
Basically, a new creditor can decide to pull a copy of your credit file which will be then used to evaluate whether or not you are qualified to apply for a loan. In some cases, your existing creditors may also want to pull your credit report if and whenever they see fit or necessary to do so. They can do that to observe and evaluate (if) there has been any significant change in the credit history.
Understanding why credit inquiries matter:
We will start by talking about credit score formula, in the first place. Credit score formulas are basically devised to protect lenders. This makes it very important. The basic idea behind the credit score is to evaluate (of course by calculations and not just mere arbitrary estimation), how capable are for a new credit or how likely a customer is to default on new credit extended to them. if you have a low credit score, then according to the creditor, the likelihood of you defaulting the loan is more, statistically speaking. If you have a higher credit score, say more than 800, then statistically, you are less likely to default a loan extended to you.
Note: It is very important for you to understand the importance of timely or on-time payments. When you keep delaying payments, the likelihood of it affecting your credit score is much higher. Also, if you keep on delaying every time, there is the clear risk of you becoming a habitual delayer. This makes it further more complicate for you.
Consider a hypothetical situation when you run into some financial issue. Suppose you have to pay bills immediately and for that reason you apply for several credit cards in a small fragment of time. Irrespective of the fact that you may easily bounce back or quickly bounce back, applying for too many credit cards at one time can lead to inquiries which can result in decreasing your credit score. However, it is one of the situations that can arise and you should not assume that it is going to happen every time or with everyone. If you are looking for an excellent agency to remove hard inquiries from credit report, consider Credit Repair and Co.
Jacab Roy is the author of this article. To Know more information about remove hard inquiries from credit report please visit the website.