January 27th, 2010
Dear Credit Karma – Credit Inquiries
Dear Credit Karma,
My son is co-signer on a loan for his car at my bank, yet he still shows no credit history available; why is this so?
Co-signing for a loan should show up as an entry on your son’s credit report, so double-check whether it has been accurately reported to the credit bureaus by looking at his Credit Report Card and also by requesting a free credit report at Annual Credit Report. A more robust credit history will help in earning a great credit score, so make sure your son is benefiting from having this loan on his record.
Once you are sure the loan is not accounted for in his credit report, contact your bank and alert them that your son’s co-signer status for the loan was not reported to the credit bureaus. Request to have this error rectified immediately. Follow up in two or three weeks by taking a look at your son’s credit report via his Credit Report Card or Annual Credit Report to make sure the loan has been added to his history—if the loan is in good standing, adding it to his credit history should also boost his credit score.
Dear Credit Karma,
If I apply to rent an apartment and did this on 5 different properties before deciding, how much will it lower my credit score assuming the apartment owners will do a credit inquiry per their advertisement of “on approved credit”?
The impact of these credit inquiries on your credit score will depend on how each apartment owner will generate the credit check. If they request a soft inquiry, as is the case with “pre-approved” credit cards, and other self-initiated credit report pulls like with Credit Karma, it will not affect your credit score. If they use a hard inquiry, it will lower your credit score by a few points and remain on your credit report for 2 years. But be leery that if you allow all five owners to do a hard inquiry, these inquiries will certainly add up in damage to your credit score.
Check out the graph of the distribution of credit score to number of credit inquiries from the Credit Karma community for a sense of how many hard inquiries can impact your credit score. In addition to hurting your score, multiple inquiries on your report may also affect your future loan, mortgage, or credit applications because lenders may view you as a high-risk borrower. There is a possible silver lining: if the apartment owners do conduct hard inquiries, some credit scoring models have been adjusted to count multiple hard inquiries within a 14-day period as a single inquiry.
Ask each landlord what type of credit check they will be doing. If they are planning to do a hard credit inquiry, suggest that you pull your own credit report, such as the one from Annual Credit Report, and take it with you to each apartment owner to minimize the number of hard inquiries on your report. If some apartment owners have already done hard inquiries on your report, you won’t be able to remove the negative impact. But take heart; the damage to your score will fade over time. In the future, be aware of what type of credit checks are being done on your credit report and avoid multiple inquiries in a short period of time; otherwise, happy apartment hunting!
Submit a question now, and maybe Credit Karma will answer your question on our next Q & A blog post!
