Page 58 - Winning The Credit Game Bundle (CK Patrick)

46 THE CREDIT GAME

And there’s another concern too. Why are you applying for all these
loans and credit cards? Are you in big financial trouble, which might
indicate that you might be less successful at paying all your bills in the
future?
The frustrating part of this scoring system is that the number of
hard inquiries reported to credit bureaus often doesn’t accurately
reflect how much money you actually want to borrow.
Having many hard inquiries doesn’t necessarily mean that you
want to take out six loans, or open six new credit cards; it could just
mean that you applied to six lenders with a plan to only accept the best
offer you got as part of a wise, strategic credit move.
But the credit bureaus don’t know your intentions. If they get six
hard inquiries, they’ll assume you actually wanted all six credit cards.
And there’s nothing you can do about that, except study and strategize
to get the absolute best offers with the absolute minimum number of
hard inquiries.
As with all things in the credit game, knowledge is power. If you
don’t know how hard inquiries work, you can end up severely
damaging your credit without even doing anything irresponsible. I
have been in this exact position.
When I decided that my credit was good enough to get favorable
terms on a car loan, I was so proud of myself. I had worked so hard to
build my credit score, and it was about to pay off. I was going to be a
responsible borrower: I was going to compare rates from a few
different car dealerships to ensure I got the best possible terms and
interest rates I could to save the most money.
There was just one problem: I didn’t realize that every single
dealership I applied with would send several hard inquiries to
multiple lenders on my behalf. In effect, it would look to the credit
bureaus like I was either unqualified to purchase a vehicle and
desperate or trying to take out multiple different car loans at the
same time.
Now, instead of just a few hard inquiries hitting my account, there
were about 40 of them, all stemming from the three car dealers I had
applied to!