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Hard Inquiry Deduplication and Credit Buffers



Last Verified: May 13, 2023

Navigating the waters of credit scores and loan approvals can be tricky, especially for prospective homeowners. One key concern revolves around hard inquiries from banks and their effect on credit scores. A hard inquiry is an instance where a financial institution checks your credit history to make an informed lending decision. Although these inquiries can lower your credit score, the impact is typically less severe than you might think. FICO, the creators of the most widely used credit scoring model, suggest that a hard inquiry usually lowers a credit score by five points or fewer.

Now, it’s essential to understand how FICO helps safeguard your credit score from the impact of multiple inquiries. They employ strategic measures like the “30-day buffer” and the “inquiry deduplication” process.

The 30-day buffer is a protective measure designed to shield consumers from the effect of multiple hard inquiries in a short period, when shopping for loans such as mortgage, auto and student loans. Within this 30-day buffer period, all loan inquiries are entirely ignored by the FICO scoring formula. This buffer allows potential homeowners to explore multiple lending options without fearing a significant drop in their credit score.

For instance, suppose you apply for a home loan at several different banks within a month. Each of these applications could lead to a hard inquiry. However, thanks to the 30-day buffer, these multiple inquiries within the 30-day period won’t individually impact your credit score. This protective measure ensures that consumers aren’t unduly penalized for rate shopping, a financially prudent action.

FICO’s “inquiry deduplication” process takes this protection a step further. This process is designed to recognize when multiple inquiries result from a single purchase intent, within a period older than 30 days and less than a year. FICO’s scoring model aims to eliminate all but one of these inquiries from its calculations. This applied only to mortgage, auto, and student loan inquiries of the same type made.

For instance, let’s say you applied for a home loan and your potential lender checked your credit multiple times over a few months as part of their decision-making process. With the deduplication process, FICO’s scoring model would treat these multiple inquiries as a single event, thereby mitigating the overall impact on your credit score.

These protective measures ensure that your credit score isn’t significantly affected when you’re simply trying to make informed financial decisions. Understanding these processes can alleviate worries about hard inquiries and empower you to confidently pursue your dream of homeownership.

Inquiry Example Illustration – Assume Today is May 13, 2023

Countable Inquiries On Credit ReportDate of InquiryDays Since Previous InquiryType of InquiryInquiry Counted In FICO ScoreReason
5May 1, 20236 daysMortgageNoWithin 30-day buffer period
5April 25, 202314 daysCredit CardYesCredit card inquiries always count
4April 11, 20239 daysAutoNoFewer than 45 days since prior auto inquiry
4April 2, 20239 daysMortgageNoFewer than 45 days since prior mortgage inquiry
4March 24, 202322 daysAutoYesMore than 45 days since prior auto inquiry. Previous inquiry is mortgage and different type.
3March 2, 2023180 daysMortgageYesNo mortgage inquiry within last 45 days
2October 5, 20228 daysAutoYesNo auto inquiry within last 45 days
1September 27, 2022N/ACredit CardYesCredit card inquiries always count
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