What is a score-affected credit history investigation?
There are two types of credit inquiries (also known as pulls) you can find on your credit reports:
the Score-Impaired Credit Inquiry and the Non-Score-Impaired Credit Inquiry.
A clean credit check is one that can occur when a lender pre-approves you for a credit card or loan,
or when you request your credit reports. This type of investigation does not affect your credit scores.
Score-impacting credit history investigation or deep investigation is one that can be seen by potential creditors,
occurs when banks, other lenders, and even landlords investigate your credit reports to approve your credit,
and that can include credit cards, loans, or leases.
Multiple such investigations in a short time could alarm potential creditors,
who may worry that you’ve taken out too much credit to repay, says Linda Sherry,
a spokeswoman for Consumer Action, a consumer education and advocacy organization.
There is one exception to this—if you’re applying for a student loan, mortgage, or car loan,
many lenders may ask for your credit reports, even if you’re only applying for a loan.
In this case, many scoring models can count multiple investigations
in a short period of time as a single comprehensive investigation.
A thorough investigation can stay on your credit reports for up to two years and lower your credit scores by a few points.
This may not sound serious, but according to FICO, it can have a bigger effect on your scores if you have few accounts or short credit history.
How can you determine if a credit inquiry was authorized?
There may be several ways you can determine if a credit inquiry has been authorized on your credit report.
Sometimes, it can be a case of mistaken identity.
Sometimes the name of the investigation on your report may be different
from the name of the entity pulling your report, says Ken Chaplin, senior vice president at TransUnion.
For example, if you applied for a credit card from a retail store, the entity listed on your report may be under the name of the card-issuing bank, not the name of the merchant.
Or, you may have forgotten that you authorized an investigation.
If you contact the company listed next to the inquiry on your credit report,
they should be able to provide proof that you authorized the withdrawal.
A thorough unauthorized investigation can be an indicator of identity theft and warrants prompt attention, says Chaplin.
Credit Karma has created a way to help you detect identity theft.
With the identity monitoring feature, you can use your email address to search for accounts in public data breach situations.
If your information has been exposed in error, we’ll give you tips and tools to help you take the next steps.
We will also continue to monitor your identity and credit for free.
If you ignore the credit investigations section of your credit reports, you could be missing signs that a person or company is trying to open credit accounts in your name without your permission.
It’s a good idea to investigate and dispute any in-depth investigation that you think you did not authorize with the companies that conducted it, as well as with the credit reporting agencies that reported the errors.