There was some hoopla in the press last week about a Canadian man from Nova Scotia who won a case against a major telecommunication company because the company checked his credit without his permission. In related news, I decided to pull my credit report from Equifax and guess what..? There was a little surprise in my report that I was not expecting. My score was fine, but not as high as it could have been because of the following 3 items. According to my report they are listed in order of impact to my score – the first has the largest impact, and the last has the least:
1. Most recent Telco Inquiry.
2. Number of inquiries in previous 12 months.
3. Total number of Telco inquiries.
What? Turns out about a year ago I was shopping around for a new cellular phone plan. I visited a discount cellular provider and the first thing the sales person did was run a credit check, with my permission. Turns out the phone I wanted was not in stock and the store was really busy and several kids were screaming (mine, I think) and I could not commit to a plan or phone that day.
The following week, I visited the same store and started the process all over. The credit check was run yet again and I had no idea that I was damaging my credit score in the process. Maybe I was naïve? I knew that multiple inquiries by financial institutions could raise red flags to lenders, but it never occurred to me to be concerned about entering into a cell phone contract.
Important lesson here. From now on I will ask the companies I do business with if they perform credit checks and decline them if they are not necessary.
Have you checked your credit score? Any surprises?