About a month ago, I received an alert from my Equifax service that my FICO score had dropped 16 points... argh!!!  I logged in and found that my most recent credit application from early May had triggered an inquiry limit, and flagged me as a consumer desperately seeking credit.  Well, it is true that I have applied for credit more over the last 2 years than in any period of my life, but it has not been in desparation.  Over the last 2 years, I've purchased a home and a townhouse, both for rental purposes.  I opened several credit card accounts, including one each from Home Depot and Lowes, to help finance and improve the properties.  All these accounts had very attractive initial interest rates, so it made a lot of sense from a pure financial and accounting standpoint.  My initial seed money for the purchases came from a home equity line of credit (HELOC), and I've since refinanced the first home I purchased.  My two rentals are doing well and turning a small profit, and I have significant equity in both properties.  Yet the vagaries of the FICO formula conspired to make me look desparate.  As I've mentioned before, the FICO formulas don't know or care what your income is or what assets you own, they simply look at trends in your credit habits and try to predict the future based on large-scale patterns of those with similar credit habits.  Some will be helped by these calculations, while others will appear to be a greater credit risk than they really are.

I pulled a free credit report from both Equifax and Experian, to see if any of the inquiries could be disputed.  As it turns out, out of a total of about 10 inquiries, I believe there are 3 that I can reasonably dispute as unauthorized.  One was a milk delivery service that talked my son into a trial subscription, in return for free ice cream.  He didn't even save any for me, and got a stern lecture about using my name and SSN without my permission.  Two others were related to mortgage applications where the bank really did not need to pull another report.  The good news was that Equifax had a very simple on-line dispute process, which I just completed.  Much to my surprise and delight, they decided in my favor, and my FICO from Equifax regained the 16 points almost immediately.

If you decide to dispute inquiries (or any credit file information, for that matter), keep in mind that the three credit reporting agencies all generate separate credit reports, so you'll need to dispute with each company separately.  Experian doesn't have an on-line dispute capability for inquiries (they do for other information like late payments).  So I've written them a letter to plea my case.  Hopefully I'll have an outcome in my favor with them as well.  I'll be looking into the TransUnion process in the coming days, as well.