May 2nd, 2011

Credit Karma Q&A: Hard Credit Inquiries and Accounts in Collections

6 Comments | Twitter | |

q

Several actions can negatively affect your credit score: hard inquiries, accounts in collections, tax liens, bankruptcies, and foreclosures are some of the most common. But how do they really affect your credit? For how long will it affect your credit score? What can you do if you think the negative information is inaccurate?

All of these are commonly asked questions over in our Credit Advice center, a community-powered Q&A forum. Credit Karma users are always prepared with great answers, many times straight from their own financial experiences.

Here are some responses to the common questions around hard inquiries and accounts in collections.

Hard Credit Inquiries

  • Credit inquiries will fall off your report after 24 months. There is nothing you can do to get rid of them, but the negative effect to your score should be relieved within about 4 months. (How do I get rid of credit inquiries?)
  • At this point, just see what happens in a couple of months. Scores can fluctuate quite a bit from inquiries and can bounce back quickly. It took about 60 days for mine to bounce back. (Card dealer credit inquiries)
  • You can pull your credit reports from www.annualcreditreport.com for free once a year and it will list on there who has pulled your credit. (Hard score inquiries).
  • This is potentially a case of identity theft. If you have a lot of inquiries you don’t recognize, call the credit bureaus immediately and put freezes on all of your reports. (Mysterious credit inquiries)
  • Although hard credit inquiries don’t have a huge negative impact on your credit score, you should never apply for tons of credit at once. You’ll appear credit-hungry and risky to lenders if you do so. (Credit Karma blog)

Accounts in Collections

  • Another option is to get a secured credit card…. I think people spend more wisely when it is their actual money they are spending, instead of an unsecured loan. (How to get rid of collection accounts and charge offs?)
  • Settling a debt in collections will often be reflected as “Paid – Not as Agreed” and will affect your credit score. Given that you are in collections already it may not make a big difference. (Paying off debt in collections in full vs. settling)
  • Depending on how you resolved your credit collections, these negative marks will reflect in your credit score even after you’ve paid them off… The good news is the effect on your credit score will decrease over time. (Credit Karma blog)

Still curious about how negative marks affect your credit? Head over to the Credit Advice center and ask your own burning question.

And stay tuned to Credit Karma blog because next week, we cover how credit over-utilization and tax liens affect your credit score.

6 Comments

  1. desperate for advice that is ACCURATE!!! credit score is high 700′s says Excellent? credit utilization is 23% no sure if that is really bad or not? some say under 33% or some say 10-11%? when this credit report was run it showed i had credit cards with zero balances i never knew i had… seems back 15-20 years ago when all these folks sent you cards in the mail… and you just tossed them… THEY ACTUALLY OPENED ACCOUNTS at that time!!?!?! but, the advice i was given was DO NOT CLOSE THEM NOW… it will lower my ‘total credit’ ability. YET, I got a bad ding on my report anyway because one of the 2 cards we actually use (one is zero balance & if used is paid in full that same month)…. the one we use and carry a balance on… flags that it is too close to limit? i will admit it is a high balance.. we allow all 3 of our children and 2 of our 10 grandchildren to use on this account due to the 2 grands in college. but, i always make DOUBLE the amount due payments. the history of the account is PERFECT!! in fact, they have lowered my interest in the past 5 years because of my great history with them. But, the account is NOT right at the limit…. there is still quite a bit there to spend if need be.? we have read about things to do… and there are clearly TWO DIFFERENT OPINIONS on what will and will NOT hurt your credit on both these actions!!! i can NOT afford to drop my score at this time!!! but, if i could get it better then i think i would like to do one of these things. The answer i need is which of these scenereo’s will help and which will harm my rating?:::::> A) move a portion of that balance to the zero balance card to lower the balance of it, leaving the balance further from the end limit? ~OR~ B) call my credit card company and request they raise my limit to move that end limit further away from my balance? Please help if you truly know what will happen to my score in each situation! THANK YOU SINCERELY! we are old, sold our large home with lots of land upkeep as well to downsize so we are able to still live on our own…. never been thru all this credit ‘raping’ before??? PLUS, lenders are very leery of you if you dont work any longer… doesnt matter how nice of a retirement income you have. to them you are on a FIXED INCOME on a banana peel headed towards 6 foot under! sadly… there is probably truth in that… even if we dont want to admit it! hahaha

    mamagirl3 at 4:11 pm on October 6, 2012
  2. Hi, there! We highly recommend you use our Credit Advice Center for these types of questions. It’s a community-powered forum for credit questions and answers. Good luck!

    bethy at 10:48 am on October 8, 2012
  3. I still see on my credit report, that there’s a debt in collections for $912. I’ve talked to the original debtor and that representative said that the debt would be charged off of my credit report within a few months. When I checked back to see if it was charged off, the representative said that it was. Do I need to get a letter from the company to show proof that this has been charged off my report?

    Lamar Holcomb at 4:45 pm on February 11, 2014
  4. Mike

    Hi Lamar – All of CK’s information comes directly from TransUnion. If you haven’t already, please check out the following link to learn more about the information dispute process: http://www.creditkarma.com/article/dispute-credit-report-errors

    Mike at 4:15 pm on February 12, 2014

Enter your comment