Q & A | Impact of Multiple Credit Score Inquiries By Mortgage Lenders

Q: Since one of the stated purposes of the CFPB final rule and the new Loan Estimate form is to promote interest rate comparison shopping by consumers, will multiple credit score inquiries by mortgage lenders have a negative impact on the consumer’s credit score?

A: As long as the comparison rate shopping is done within a limited period of time, inquiries from multiple mortgage lenders will be treated as one inquiry and not have a negative impact on the credit score.  Most credit scoring models have been designed to recognize when a consumer is rate shopping.  The time period can differ between FICO and VantageScore credit scoring models, but generally if multiple credit score inquiries are received from mortgage lenders in a 14 – 45 day period, they will not be treated as separate hard inquiries.  Most credit scoring models rely on a 30 day window for purposes of determining if multiple inquiries impact a credit score.