A case study of a 470,000 point application spree

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In mid August, my wife applied for 8 credit cards across three banks.  After a few phone calls, all 8 cards were approved.  You can read the full details here and here.  Currently, we’re still working on the minimum spend requirements for some of these cards, but in the end we expect to earn a total of 470,000 points and miles.  In the prior posts I added plenty of warnings and caveats.  If you’re thinking of doing something similar, please take a look at the prior posts and read the “Caution” sections.

Now that almost two months have passed, I thought it would be interesting to look into the results of this application spree.  How was my wife’s credit report and credit score affected?

Credit report

Everyone is entitled to a copy of their own credit report every 12 months from each credit bureau.  My wife requested all three, online, from annualcreditreport.com.  The credit reports do not show her credit scores.  Instead, they show all of the data used to calculate her score and much more.  My primary interest in these reports was to to find out which credit bureau’s issued “hard inquiries”.  These are the inquiries that can affect your credit score and your ability to get approved for additional cards.  Soft inquiries do not affect your score or your ability to obtain credit.

In some cases, when you apply for multiple cards from the same bank on the same day, the inquiries get merged together by the credit bureau.  Since my wife applied for cards from just 3 different banks, she could have ended up with as few as 3 hard inquiries.  That would have been ideal.  Here, though, is what we found.  Inquiries are separated by credit bureau:

Experian

  • American Express August 13
  • American Express August 18
  • Bank of America August 13
  • Citi Cards August 13
  • CBSD August 13 (I believe this to be CitiBusiness)

TransUnion

  • Bank of America August 13

Equifax

  • Bank of America August 13 (soft inquiry)

As you can see above, my wife’s Experian report suffered 5 hard inquiries and her TransUnion report had only one.  Let’s look at these by bank:

American Express

My wife applied for 3 American Express cards on August 13.  Two were auto-approved and one was pending.  I’m guessing that if she had called on August 13th to get an instant decision on the 3rd card, then all three inquiries would have combined into one.  Instead, the call was made much later and appears to have resulted in another hard pull.

Citi

Citi has a rule limiting people to applying for no more than 1 personal card in a day.  So, my wife signed up for both a personal card and a business card.  The two inquiries were issued from different named organizations and they were not combined.

Bank of America

My wife applied for 3 BOA cards on August 13th and was eventually approved for all three.  It’s interesting that BOA issued hard inquiries to two bureaus and a soft inquiry to the third.  It is likely that multiple inquiries were issued to each bureau and that they were combined into one (per bureau).

Credit Score

As you can see above, my wife ended up with more than the hoped for 3 credit inquiries.  With Experian alone, she had five.  So, what did this do to her credit score?

American Express offers free Experian credit scores to many cardholders, so were were able to easily check her score.  On August 26th, her score was 778.  A month earlier, her score was 799.  So, it appears that the credit card applications may have decreased her score by 21 points (799-778).  I wrote “may have” because many things can affect a credit score from month to month, so there’s no good way to know how much of this change was due to the credit card applications.

application spree Experian score

5 weeks later, Amex displayed a new score: 782.  It is common for scores to incur a hit of about 4 or 5 points per hard inquiry and then to gradually go back up (often to new heights) afterwards.  We don’t yet have much data to prove it, but I do think that’s what is happening here.

application spree Experian score

My wife’s TransUnion report showed one hard inquiry, so we looked at how her TransUnion score was affected.  Barclaycard lets cardholders see their TransUnion score over time.  As you can see below, my wife’s TransUnion score has hovered in the mid 790’s for a while, but then dropped to the mid 780s in August.  Specifically, between June and late August, her score dropped by 10 points.  Again, we don’t know how much of that change was due to the credit card applications.

application spree TransUnion score

application spree TransUnion score

My wife’s Equifax report didn’t have any hard inquiries.  Citibank let’s her see her Equifax score for free, but Citi hasn’t yet collected historical scores for her. The one score shown is from late August.  And, it looks good:

application spree Equifax Score

Wrap up

Banks don’t necessarily pull from the same bureaus every time and for every person.  So, if you were to replicate my wife’s set of credit applications (which I don’t particularly recommend), you will likely see different results.  Still, there are a few useful conclusions (admittedly based on very little data) that can be made:

  • Amex inquiries apparently do not get combined when the approvals are 5 days apart.  If my wife had called to force a decision on the day she applied, it is likely that she would have had one fewer hard pull.
  • Bank of America inquiries made to the same bureau on the same day do get combined, but there is no guarantee that you won’t have inquiries hit more than one bureau.
  • Citibank inquiries do not get combined across business and personal cards.

Even though my wife’s credit reports ended up with more inquiries than I had hoped, her 21 point Experian dip isn’t something I’m concerned about.  Based on past experience, I expect that her score will steadily rise month over month and it will most likely reach or even exceed its previous high.  Unless, that is, she applies for more cards before then…

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