How long does is take for credit score to go back up?

Question by Hallie: How long does is take for credit score to go back up?
We recently refinanced our underwater mortgage. When applying for a car loan today, we discovered that our credit score dropped over 100 points. When we checked the Equifax report it showed 11 credit inquiries in the 6 months it took to close the refi. This seems to be the only reason for the drop as our score was previously over 800. How long should it take for the score to go back up?

Best answer:

Answer by bdancer222
Those 11 inquiries over 6 months did ding your score, but no where near 100 points. Mortgage lender inquiries within a 3 to 4 week period only count as 1. So even if your refi was strung out over 6 months, those 11 inquiries are not as bad as you thought.

The real reason your score dropped 100 points is the refinace itself. It’s a new loan. The old loan was paid off and closed. This means that most of your debt is brand new. In about 6 months your score will begin to rebound, but it will take a while to get back to that 800+ point.

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2 Responses to How long does is take for credit score to go back up?

  1. Confused but not stupid says:

    Probably a year from the last inquiry for the points from those to fall off. Technically they stay on for 2 years, but the biggest impact to a score is for the first year. Other factors which might be affecting the score is utilization rates. Pay your balances to less than 40% of your limit. After a year the mortgage should also help improve your score, this loan itself, while a refi, is also impacting your score. When the old loan shows as paid it should improve your score also.

    You should get a free service like Credit Karma and it will help you track your report. While it does not have a true FICO score, the advice they give you is valuable. It will allow you to see over time what is happening to your score. If you don’t need any new credit, then you should be fine. Since these inquiries are for a mortgage, it really is not supposed to affect your score as much as it is, if this is the case. However, since they were done over the space of 6 months it is. If they had all been done in the space of 30 days there would have been less of an impact. You could try asking that some of them be removed.

  2. StephenWeinstein says:

    One year.

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