How many credit enquires is considered too many?

Any general questions you might have in regards to loans and finance.
Michelle91
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Joined: Mon Feb 18, 2019 12:50 pm

How many credit enquires is considered too many?

Postby Michelle91 » Mon Feb 18, 2019 12:51 pm

Hi there, now that I’ve finally decided to buy my first home, I’ve been looking into how the banks will view my home loan application. Who knew too many loan applications were bad for your credit. I sure didn't. When applying for a home loan, how many credit enquires is considered too many?

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Otto Dargan
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Re: How many credit enquires is considered too many?

Postby Otto Dargan » Mon Feb 18, 2019 3:31 pm

Hello Michelle. Welcome to the forums.

As a general rule when applying for a home loan, most lenders prefer that you only have one or two credit enquiries over a 6-month period.
Any more than that and they may consider you a high-risk borrower and decline your mortgage application.

Credit enquiries are recorded on your credit file each time you apply for credit with a lender. The credit file is held by Equifax (formerly Veda).

Speak with one of our experienced mortgage brokers today to find out if you qualify for a home loan by calling us on 1300 889 743 or fill in our free assessment form.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Michelle91
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Joined: Mon Feb 18, 2019 12:50 pm

Re: How many credit enquires is considered too many?

Postby Michelle91 » Mon Feb 18, 2019 4:40 pm

The last time I checked, I had a decent Equifax score of 600, but I’m still afraid that too many enquiries since then might be a problem for me. How long do credit enquiries usually stay on your credit file for?

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Otto Dargan
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Re: How many credit enquires is considered too many?

Postby Otto Dargan » Mon Feb 18, 2019 6:03 pm

Hi Michelle,

Credit enquiries will remain on your credit file for five years from the date that they were lodged.

That's not a big deal in itself.

For example, if you made more than two enquiries in the last 6 months, there are specialist lenders that can consider your home loan application.

It really just depends on the rest of your situation, in particular, that you have been making your repayments on time, every time.

In addition, you need to provide explanations for each credit enquiry.

There can sometimes be legitimate reasons for having too many enquiries such as system errors with the lender or credit provide where you have multiple enquiries for just one loan or credit card application.

It's great that you've checked your credit file before applying for a home loan and adding yet another enquiry to your credit history because you will have been declined if you applied with the wrong lender.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Davidbeck
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Joined: Mon Jan 28, 2019 6:51 pm

Re: How many credit enquires is considered too many?

Postby Davidbeck » Mon Feb 18, 2019 6:47 pm

Hi Otto, I recently got approved for a rewards credit card, however, I’d rather go with another provider now. With two credit card enquiry within the same week, will that look bad when applying for a home loan? What kind of activities show up as an enquiry?

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Otto Dargan
Mortgage Specialist
Posts: 7484
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: How many credit enquires is considered too many?

Postby Otto Dargan » Mon Feb 18, 2019 7:30 pm

Hi Davidbeck, welcome to the forum.

In most cases, credit enquiries show up when you apply for a home loan. However, it can also include:
  • Loans such as mortgages, personal loans and car loans.
  • Credit facilities such as credit cards or store cards.
  • Interest-free finance for white goods and furniture.
  • Utilities such as electricity and gas.
  • Telecommunication services such as mobile phone or broadband contract.

Give us a call on 1300 889 743 or fill in our free assessment form so one of our mortgage brokers can assess your situation and help you get approved for a home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


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