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Too Many Credit Inquiries Pulled? What To Do Next

Too many Credit Inquiries?

Has your credit pulled too many times recently?   Has your business also been declined for excessive inquiries? Business owners often get turned down for having too many in the last 30 to 60 days. Even if they are approved, they get lower approval amounts and shorter terms.    Author Biography: Will Sanio

These programs specialize for people that have had their credit pulled too many times recently.

For programs that work best with a lot of inquiries, as well as offering the highest amounts with longest terms. Apply below:

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Too many credit inquiries pulled
Options if too many credit inquiries were pulled.

1. Other helpful actions
2. Recent credit inquiries
3. inquiries from mortgage companies and car loans
4. Talk to a representative
5. Ask for the criteria
6. Hard or soft pull

Too many credit inquiries pulled

If you need a program that will not deny you for having your credit bureau pulled a lot, apply above.

Frequently asked questions FAQ: too many credit inquiries pulled

Can I get a business loan with a lot of inquires on my file?
Approval offers can be made with many recent credit inquires on a person’s credit file.  Many times they are not relevant to the risk. This includes those for cars, housing, utilities, or an applicant not knowing multiple pulls were made for one request.

Why are a lot of inquires a problem?

Lenders do not know if you were approved and a new account was opened that isn’t showing up yet as a trade line in your file. Approvals from recent inquires take a few weeks to show up on your credit file.

Can I just submit a copy of my credit report to get a decision?

A copy can be provided to assist in the decision. A separate bureau is pulled to make any final offers or approvals. Bureaus are pulled separately so the most currently dated file can be reviewed.

Do lenders have to check my personal credit to get a business loan?

Business loans without the personal credit of the owner being pulled are very limited. These are known as corporation only requests. Smaller companies with less than 35 employees rarely get approved for these.

 

General credit inquiry Questions and Issues

“I had my credit pulled too many times and can’t get approved”
A broker sent my file out a bunch of lenders and now I can’t get approved for a business loan.  What can I do?
They told me my file has been shopped and I have too many inquiries.   What kind of financing can I get now?
“They pulled my credit too many times”

In general, your credit and credit score recovers from inquiries faster than any other type of derogatory or adverse action.    One pull may drop your score just a few points for a relatively short amount of time.

General Inquiry Information

Do inquiries hurt my credit?

A credit inquiry is often part of the process of applying for credit and should not be considered a negative by the applicant.  Lenders also know that applicants will have some checks on their file.
How many inquiries are too many?

There is not one answer to how many bureau pulls are too many.   This varies on a case by case basis.    Older credit files can have more inquiries before they are impacted.  Another  difference is that some inquiries are necessary and some credit inquires you cannot avoid.

Other helpful actions

Actions you can take if your credit has been pulled too many times

recent credit inquiries

Count the number of inquiries in the last 30 days. Remember which companies checked your file.   As mentioned, some checks on your file should not affect your request for financing at all.  Make lenders will manually review your bureau and may overturn any denial.

Inquiries from Mortgage Companies and Car loans

The ones from mortgage companies or to finance a car should not count against you.   Tell the lender if you have these.

Talk to a representative

When applying for financing, try to talk to a representative that knows the lender’s criteria and can talk to you about it.   Will they decline for too many inquiries within a certain amount of time?

Ask for the criteria

Ask lenders to tell you as much about their approval criteria as they are willing to tell  you.  You may be able to find out that you will very likely be declined for a business or personal loan.   You can decide not to apply and avoid the inquiry before it is even pulled.

Hard or soft pull
Find out if the pull was a hard or soft pull.

We are a leading funding source for all Small Businesses looking for the best alternatives to Banks.

Author Biography: Will Sanio, Owner of SCF Funding, dba SmallBusinessLoansDepot.com, has a Bachelor of Science Degree in Business Administration with a concentration in Finance from the University of Tennessee, Knoxville.

Over 20 Years experience including 10 Years with Wells Fargo, formerly Wachovia Bank and First Atlanta Bank. Specializing in Traditional and Alternative lending.

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Will Sanio:  University of Tennessee Diploma – Bachelor of Science in Business Administration with concentration in Finance – Click or Tap to Enlarge Image.
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Business Partner with Bad Credit? 4 Quick Workarounds

Have a business partner with bad credit?

Pick from several loan options when you have a  business partner with damaged credit.    That partner can even be you!

An associate with a low credit score will cause challenges.

4 fast fixes below are designed for EXACTLY these situations.

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Apply above now and get business funding today with business owners that have low credit scores.

Temporary Options and Solutions:

1. Good Credit Owner: Applicant #1

The stronger credit owner should always be the first applicant on any request.

Never list the bad credit owner first. A strong credit owner may be enough to carry an approval and cause the lender not to reject for remaining bad credit.

2. Change in Ownership Percentage

The most impact that can be made fast is lowering the ratio of ownership of the partner with bad credit.  They may not agree to this.    However, lowering it to less than 20% should prevent declines and less than 10% would be even safer.

This will not be popular with many owners. Companies can consider options including a remix of company stock ownership.

Higher salaries and a commission structure can be increased. Another compensation is to pay more towards IRA’s, Pensions and Savings plans.   The change can be temporary.

3. Change Articles of Incorporation

If the partner with hurt credit agrees to lowering their stakeholder amount, the Articles of Incorporation should be changed to reflect this.  Many States show ownership breakdown in the Articles of Incorporation.

4. Updating the Secretary of State

Update the Secretary of State listing which lists information on the company.  Remove the owner with bad credit, or their lower percentage.  List the owner with better file as the main owner.

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FAQ Frequently asked questions on getting a business loan with a partner with bad credit

Question: Can we get a loan if my business partner has bad credit?

Answer: Search for lenders that offer programs specifically for business partners with bad personal credit and low bureau scores. Ask about approval requirements in advance, including a minimum credit score.

Question: What can we do after being denied a business loan for my partner’s low credit scores?

Answer: One option is to lower their ownership percentage at the secretary of state to below 20%. Some lenders won’t require them on the application or decline for derogatory trade lines if their shareholder percentage is very low. Another option is to remove them entirely as owner of the business.

Question: Should we try to fix my business partner’s credit instead of taking them off the business altogether?

Answer: Work on improving the bureau first if there is enough time. They can be lowered to 5% ownership or less and avoid being reviewed by many lenders.

How a bad credit partner negatively affects a business

Getting approved with a low credit score partner.

Options are more limited when applying for financing with a partner that has derogatory personal credit.  Lenders may decline when the ownership split goes over 20%

Some funders will not pull a bureau if the shareholder percentage is less that 20%. If the percentage is less than 5% or 10%, more lenders will not look at the information of those owners. If the business partner with a derogatory file has close to 50% interest, then chances are much higher the request will be declined. This is especially true with more traditional lenders like banks and the SBA.

Once the company has taken care of the financing needed,  the owners can consider longer term programs for derogatory history.   Should an owner with bad credit fix it or wait it out?

Getting a business location

Renting a location

Once a commercial location is found, the company owner’s credit is looked at. Landlords will pull a bureau.
Damaged credit may cause a rental request denial. Discuss this with the landlord. If the other owner has a very good file, the landlord may approve the rental request and lease the property.

Buying a location

If your company wants to finance the purchase of a location through a commercial mortgage, the lenders will also look at all the owner’s credit. The level of scrutiny will be higher than with a rental request, including full financial information.

Establishing business trade accounts

Many companies establish trade accounts.   Companies check the business and personal credit of the main owners when a trade account is applied for.   Significant negatives in the file may be a reason for denial.   Not being able to secure important trade accounts can be very damaging and cause the business to be short of the inventory, equipment and other critical needs.
Even if the business can secure the trade accounts it needs, the terms may be more expensive because of the partner with bad history. This will translate to increased costs to operate.

Obtaining Government and Private contracts

When a business bids on private or government contracts, the personal credit of the owners is reviewed. If there is a business owner with a severely damaged bureau, it will be more difficult to secure these contracts. The contract request may even be denied for this reason.

Background checks

There are many reasons why a background check for a business loan may be completed on the owners.  Some of the reasons have already been listed. If a background check is requested, it will include a bureau.  Bad trade account history on any of the owners may be a reason for denial in a background check.

If further assistance is needed, the SBA has excellent resources.

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Asset Based Loan

Credit Inquiries You Cannot Avoid

“Credit Inquiries” has been a topic of much conversation and concern in recent years.  The following is current information you should know about credit inquiries you may not want to avoid.

There are however,  credit inquires you should not avoid because they often are the best programs available in the market.  Soft pull credit options are available as well.   Apply Below: 

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Some of the best business loan programs are hard pulls

Avoid all credit inquiries can keep you from getting what you want..

Many people are reluctant to have  credit inquiries to be pulled on them even if they are applying for a loan.  They tell lenders that they want to be considered for the financing without their bureau being pulled.

This is not feasible or realistic, especially if the request is in the name of an individual.  In most of these cases, these requests are in the name of a small business and the owner wants the request to be in the company name, not in their personal name.

If a business has less than 35 employees, in most cases the lender requires the owner’s credit to be reviewed.   There are options you can take if you have had too many credit inquiries pulled.

But I pulled my own credit report!

Virtually no lenders will decide your loan request with a consumer obtained bureau.

Consumers can contact credit reporting agencies as well as outside vendors that provide bureaus and get all 3 bureau reports.   These files are not the same that lenders obtain.  Consumer reports are formatted differently and are simpler than the lender’s re.  The consumer version often provides more written explanation and sometimes less numerical detail.

Consumers will sometimes review their bureau and tell the lenders to use the consumer obtained reports they have rather than the version pulled by the funding source.   The report the consumer has will almost always be older.   The lender wants to see if anything has happened since the date of the report the consumer has in hand.

There are many outside vendors that provide intermediate party credit files.  Lenders are not, and should not be expected to know whether those vendors provide updated and satisfactory information.  Lenders are not obligated to use those.  As a result, consumers should not expect to avoid inquires by demanding that lenders use their consumer version.

 

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Asset Based Loan

Business Lines of Credit: How to Get The Most Difficult Business Loan

In most cases, a business line of credit is the most difficult type of financing to get.   Business owners should look at the terms.  This  includes interest rates, number of months, total amount of the repay, and early payoff considerations.

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FAQ Frequently asked questions on how to get a business line of credit

How can I get a business line of credit?

Time in business of two to three years is often required. Other requirements include a 680 or higher credit bureau score, full financials and industry requirements. Full financials means 3 years business and personal tax returns, a personal financial statement and interim financials. Interim financials are a year to date profit and loss statement and balance sheet.

Why are business lines of credit so difficult to get?

A business line of credit is hard to get because it is set up to be available indefinitely to the borrower and does not have a limited term. Lenders consider this long term exposure to be high risk and require a longer history of business success with increasing gross and net income. If the business shows low net income and flat revenues, they are unlikely to be approved for a business line of credit.

Can my lender require me to suddenly payoff my business line of credit?

An annual payout provision and the lender being able to call the loan and require payoff at anytime is legal and enforceable when it is written into the contract. These provisions are extremely risky for borrowers. Lenders sometimes call loans because they decide to lower their risk models, or when they are being acquired by another lender. They may call loans even if the borrower has a clean payment history. Borrowers do not know in advance their loan is going to be called and often cannot pay it off immediately. Their business could fail because lenders may be able to seize their accounts receivables, real estate or any other collateral attached to the line of credit.

Some lenders put conditions on a line of credit that negates all of the other advantages of the financing.  Lenders may require the borrower to put up their home as collateral.  Borrowers should realize this becomes a home equity line of credit.  Borrowers are then giving their home and business assets as collateral. Why not not consider a home equity line of credit then?

Borrowers may be better off looking for other financing first. Attempt to negotiate the terms of the approval with the lender when your business is using real estate as collateral.

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Asset Based Loan

Can a Strong Co-signer Make Up for a Bad Credit Primary Signer?

There is a long history in credit of using a strong Co-signer to strengthen an application. However, can they make up for a bad credit primary applicant?

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What is a Co-Signer?

It is anyone that signs with you on a loan request.  It is normally done when someone with stronger and better credit than you offers to sign to help you secure financing.    A co-signer is jointly liable for what they are signing for.

In general, a strong Co-signer does not make up for a bad credit primary applicant.   If the primary applicant has a lot of derogatory information, a strong co-applicant often can’t help turn a decline into an approval.   Great credit does help in situations when the primary applicant is not strong enough, has limited credit or minor negatives on their bureau.

There are several reasons why a strong Co-signer is often not helpful when the primary signer has significant derogatory credit.

Lenders know that in most cases, Co-signers sign only to help the primary applicant get the loan.   They really don’t want to pay past due or default payments.

Examples are parents that sign for their children to help them get a car loan.   However, there are many other examples.    Sometimes another relative or friend may help them get the loan.    In these cases, the secondary signer does not get the proceeds or asset being applied for.

Due to this, if the primary applicant runs into difficulty and cannot repay, the guarantor usually does not want to pay because they received no benefit from it.    In the past, guarantors have told lenders that they just signed the paperwork to help the other person get the loan.

In some cases, the C0-signer really believes they will not be held responsible.    They believe their responsibility stopped after they signed the paperwork.

Lenders know primary applicants with bad credit will go past due often.  As a result, the excellent credit guarantor will be asked to make good on the debt.

Strong Co-signers cannot always help a derogatory credit primary applicant get approved for a loan.

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Asset Based Loan

Are Credit Inquiries Really That Bad?

A lot has changed in the world of credit inquiries in the last 35 years.  Many people believe they are very bad and they should try hard to avoid them.

30 Years ago,  many people did not know what credit inquires were.

In 2022 a high percentage of the population knows what credit inquiries are.  Many believe that even one or two extra inquiries are very harmful to their credit.    Are they really THAT bad?

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In terms of credit issues that may be considered “bad”, credit inquiries are probably the least worst offenders.  Credit scores recover from credit inquiries faster than just about any other personal credit item that is considered derogatory.

When Credit Inquiries begin to hurt credit

Inquiries will have a very limited affect on a credit file if the number of inquires is small.   Credit inquiries begin to hurt a credit file more significantly if the number of credit inquires is more than about 5 in one month.

When some of these inquiries are from Car Dealers or Mortgage companies, they may not affect a person’s credit score at all.

If the number of inquiries is 5 in the last 30 days, try to minimize the number of inquires in the next 30 to 60 days.

Once an individual does have more than 10-15 inquiries within a month, as long as they go a few months without almost any inquiries, their score will recover quickly.

Their credit score will likely be close to what it was within 2 to 4 months.

In summary, are credit inquiries really that bad?    In many cases, a few credit inquiries on a credit file within 30 days have a minimal impact on someone’s credit bureau score.

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