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Hard inquiries and raising my score by paying off or decreasing card balances sooner than later.
So I went to see if I could get a car financed and the guy said that up to 8 inquires within about 2 weeks are allowed until 1 hard inquiry gets put on your credit score. Well, my score was 548 and it dropped to 532. The guy said it would drop a couple points but not much more than that. Obviously he lied! This is apparently a high rated dealership too. Anyway, I was just wondering how those inquiries really work and affect one's score. Also, I have 2 credit cards. One of which is over the limit and close while the other is past the expected pay off time. Should I pay these off or get them below 30% within a few months? Or make more payments over a longer period of time? Which way will raise my credit score quicker?

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Pay them off if you can...

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You should always strive to pay off your credit debt.  don't carry a 30% balance just for the sake of carrying a balance. 

The lower the utilization ratio, the better your score will be.  In fact, it'll probably jump considerably if you get below 30%...and jump again when you hit 9%.

But don't close those cards when you pay them off.  Keep the account open and just use it very sparingly and pay it off each month.  Closing it would hurt your utilization ratio. 

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First, the finance guy did not lie. What he said was true. Regarding the score drop what kind of scores are you looking at? The finance guy was most likely talking about FICO scores and you are probably looking at non-fico scores. You will still see all inquiries on your reports but they will only be scored as one like the finance guy said. Anyway, that minor point decrease is nothing really.


Secondly, you are putting your attention in the wrong areas. Don't worry about inquiries when you have credit cards over the limit cards that have been closed and are late on another, you are DESTROYING your credit by letting your cards go delinquent. Do whatever you can to get these accounts taken card of before collections start popping up in addition to more late/missed payments or charge offs.


Take the time to read all that you can on credit and get in the right direction fast.

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