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credit report mortgage inquiry, when I have no mortgage, never applied for one


csm
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This is on an impermissible mortgage inquiry.

I have a share savings account only, at a credit union, that I opened in October 2013.  One of my credit report monitoring services notified me that my credit union pulled an inquiry on my name in September 2015, which is 2 year later, for the stated purpose of a mortgage inquiry through Kroll Factual Data.  I do not have a mortgage and never applied for one.  I did not apply for any loans or do anything other than making deposits into my savings account.   As such, there was no reason to be generating a mortgage inquiry on my credit report.  I have excellent credit, with a credit score of around 800, with no collection activity.

Is this permissible for them to pull this without good cause?   I sent an email to the credit union asking why they pulled this and they have not responded.  The credit union didnt report anything on my name, just the inquiry that shows up.   Since this was a hard inquiry, this could lower my credit score, although my score is high, around 800.
 

Do I have a case?  What should I do?

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Because this is a credit union, there is likely no arbitration agreement in place.  That is my preferred method of dealing with something like this because it is cheap and easier for a consumer to handle on their own.  And because the FCRA is a more complicated statute, I haven't even dealt with it in court on my own yet.  I only use arbitration or a get an attorney to help me out. 

You also have the secondary issue of the fact that you are still doing business with the credit union and I assume wish to continue doing so.  With that in mind, you may want to attempt to handle this through the CRAs.  You can send a dispute to the CRAs stating that no permission was given and no Mortgage application was filed for this credit pull.  The CRA may remove it if they find it was in error.  However, if they verify that the credit union states they had permission, you may need to go ahead a file a suit.

I agree with @shellieh98 that finding an attorney to sue for you may be difficult, but it's not impossible.  I previously once had to use a national consumer attorney firm because no local attorney wanted to mess with an FCRA case I had.  Another attorney I used locally once on a similar non-permissible pull case of mine had never sued on that type of claim before and I actually had to explain to him why it was a violation, show him the statute and case laws on the matter.  In the end, both of those cases settled in my favor.

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I would also consider sending a certified letter to my credit union's VP of Lending. Usually they will looks to see what happened. My credit union did a hard pull on me -all I did was get in touch with the VP... within 10 days, their inquiry was removed.

 

Credit unions are a little bit different creatures - if you do decide to file an FCRA suit, expect your accounts to be closed without warning. An acquaintance of mine filed an FCRA against the same CU I use. Their accounts were closed by the Risk Management Dept. within 24 hours of being served.

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A VP at the CU said it was done by the marketing department for marketing purposes.  Im not sure if thats true or not, or just an answer given to try to satisfy me, or to try to cover up the real reason why they pulled it, if it wasnt done for marketing purposes.  A month before the inquiry was done, I had opened several accounts in the area.  A separate credit union told me that a local credit union organization had sent out an alert on my name, not because I had done anything wrong, but the many inquiries was considered a red flag.  I suspect that the CU who did the "mortgage inquiry" saw that alert and ran my credit as an ID check or some sort, even though all I have is a share savings account, and never applied for any loans or a mortgage.  

Separately, I asked a lawyer with a free consultation, who said that if you have an acct with the CU, as I do, they have a right to pull your credit.  He said the FCRA gives them the right to pull.

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That attorney is one of the lazy ones who are essentially akin to a collection attorney.  They can pull for the proper reason, but they just can't willy nilly pull your credit for everything under the sun just because you have an account with them.

My guess is that it may have been a promo or account review pull and some minimum wage doofus at the CU coded the wrong reason into their system.   I would contact that VP you spoke with again and explain to him that promo inquiry are supposed to be "soft" pulls as to not ding your credit score.  I would ask him to look into the issue to see if perhaps someone mistakenly used the wrong code when doing a pull.  If he refuses to correct or cooperate, then I would send the dispute into the CRA.

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  • 2 months later...

FirstHardCheese,

It was some sort of cover-up to claim it was for marketing purposes.  I think they were/are suspicious of me for having a small balance acct and making small deposits.  I never did anything wrong or deposited bad funds.  2 months later I learned they froze my account, when I mailed in another small deposit, as they rejected my deposits all of a sudden with no valid explanation.  A senior VP pulled or instructed the mortgage inquiry to be pulled.  It was an intentional pull, not done in error.   I wrote the CEO who is now looking into this.

Should I sue for $1000 for it being an impermissible inquiry since I never applied for a mortgage or any type of loan, never even inquired about one either?  Its been 3 months and they still havent removed the inquired as I asked it to be removed.

Ive sent the dispute to the CRA to have it removed.

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43 minutes ago, csm said:

FirstHardCheese,

It was some sort of cover-up to claim it was for marketing purposes.  I think they were/are suspicious of me for having a small balance acct and making small deposits.  I never did anything wrong or deposited bad funds.  2 months later I learned they froze my account, when I mailed in another small deposit, as they rejected my deposits all of a sudden with no valid explanation.  A senior VP pulled or instructed the mortgage inquiry to be pulled.  It was an intentional pull, not done in error.   I wrote the CEO who is now looking into this.

Should I sue for $1000 for it being an impermissible inquiry since I never applied for a mortgage or any type of loan, never even inquired about one either?  Its been 3 months and they still havent removed the inquired as I asked it to be removed.

Ive sent the dispute to the CRA to have it removed.

If you just sent the dispute into the CRA, wait to see what the response is.   Which CRA does this show up on?

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3 hours ago, nascar said:

See 15 U.S.C. § 1681b(a)(3)(F)

Small balances, small deposits, multiple accounts all over town. You gotta admit that looks a bit funny. I would stay away from this one.

A pull under (a)(3)(F) would be marked as an "account review" inquiry, which is a soft pull.  That is not what this was. Op said this was a "Mortgage Inquiry" which makes it appear as if they applied for a loan when they did not.  That is clearly a non-permissible pull.  The banking activities of the consumer are irrelevant to a non-permissible pull under the FCRA.

I am not as familiar with TILA, but I would want to look up to see if they must have a specific reason to freeze an account too.

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2 hours ago, BV80 said:

In order to receive statutory damages, the OP would have to prove his CR was knowingly pulled with an impermissible purpose.   Otherwise he must have actual damages.

Not for an impermissible pull.  That is a flat $1000 statutory damages if no actual damages exceed $1000.

1681n(1)(B) - in the case of liability of a natural person for obtaining a consumer report under false pretenses or knowingly without a permissible purpose, actual damages sustained by the consumer as a result of the failure or $1,000, whichever is greater

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@fisthardcheese

1681n - Civil liability for willful noncompliance

(a)  In general Any person who willfully fails to comply with any requirement imposed under this subchapter with respect to any consumer is liable to that consumer in an amount equal to the sum of—


(1) (A) any actual damages sustained by the consumer as a result of the failure or damages of not less than $100 and not more than $1,000; or


(B) in the case of liability of a natural person for obtaining a consumer report under false pretenses or knowingly without a permissible purpose, actual damages sustained by the consumer as a result of the failure or $1,000, whichever is greater;

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(1)(A) becomes irrelevant, because (1)(B) speaks to the issue of permissible pulls.  And that one says if you knowingly make a pull without a permissible reason, it is $1000 statutory.

Tell me how you accidentally go into the CRA system and pull a consumer report and I will say it was not willful or knowingly.  Otherwise, the action is inherently done knowingly.

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@fisthardcheese @BV80 or anyone else,  I'm curious when someone does a soft pull or a hard pull what exactly are they seeing differently between the two as far as detail? The only thing I can find is soft pull= current creditor checking your credit usage/no affect on credit score, hard pull= loan application/can affect credit score.

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@BV80 but what exactly are they seeing differently on a soft pull version vs. a hard pull version or are they identical? Say a consumer pulls their own report from all three bureaus. That's a soft pull. Isn't all the same detail there?  Besides this being used as a form of credit score punishment (you're loan shopping, your score just went down), is there really a purpose to differentiate the two pulls? Why couldn't a consumer print out their report at home, take it to a lender and ask them to use that for the loan application if the information displayed is identical?

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1 hour ago, CCRP626 said:

@BV80 but what exactly are they seeing differently on a soft pull version vs. a hard pull version or are they identical? Say a consumer pulls their own report from all three bureaus. That's a soft pull. Isn't all the same detail there?  Besides this being used as a form of credit score punishment (you're loan shopping, your score just went down), is there really a purpose to differentiate the two pulls? Why couldn't a consumer print out their report at home, take it to a lender and ask them to use that for the loan application if the information displayed is identical?

Yes, any pull is a full detail of everything in your credit report.

A bank will not trust that the report you are handing to them is current and hasn't been altered. 

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On 1/12/2016 at 2:28 PM, csm said:

my credit union pulled an inquiry on my name in September 2015, which is 2 year later, for the stated purpose of a mortgage inquiry through Kroll Factual Data. 

Who?

5 hours ago, fisthardcheese said:

(1)(A) becomes irrelevant, because (1)(B) speaks to the issue of permissible pulls.  And that one says if you knowingly make a pull without a permissible reason, it is $1000 statutory.

Not necessarily.

Here's the relevant statute.

Quote

1681n(a) (1)

 

Any person who willfully fails to comply with any requirement imposed under this subchapter with respect to any consumer is liable to that consumer in an amount equal to the sum of (A) any actual damages sustained by the consumer as a result of the failure or damages of not less than $100 and not more than $1,000; or

(B) in the case of liability of a natural person for obtaining a consumer report under false pretenses or knowingly without a permissible purpose, actual damages sustained by the consumer as a result of the failure or $1,000, whichever is greater;

Does anyone know why the credit union is not liable for damages under 1681n(a)(1)(B)? HINT: See below.

 

Quote

a "person" is defined as "1. A human being. 2. An entity (such as a corporation) that is recognized by law as having the rights and duties of a human being." BLACK'S LAW DICTIONARY 1162 (7th ed. 1999). In contrast, a "natural person" is defined as a "human being, as distinguished from an artificial person created by law." Id.

The credit union is not a "natural person" thus not liable for damages under 1681n(a)(1)(B).

While "person" generally means an individual or a corporate entity under the FCRA, see 15 U.S.C. § 1681a(b), a cause of action for obtaining a consumer report under false pretenses or knowingly without a permissible purpose can only lie against a "natural person." 15 U.S.C. § 1681n(a)(1)(B). Burghy v. Dayton Racquet Club, Inc., 695 F. Supp. 2d 689 (S.D. Ohio 2010).

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35 minutes ago, nascar said:

The credit union is not a "natural person" thus not liable for damages under 1681n(a)(1)(B).

Couldn't you name the credit union as well as John Does (the natural persons working at the credit union) as Defendants along with all the relevant statutes so something sticks?

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11 minutes ago, CCRP626 said:

Couldn't you name the credit union as well as John Does (the natural persons working at the credit union) as Plaintiffs along with all the relevant statutes so something sticks?

If an attorney named the credit union as a defendant, knowing you had no cause of action against it under 1692n(a)(1)(B), I would expect a sanction motion from defense counsel. I suppose you could also go after credit union on 1692n(a)(1)(A) for your $100 bucks and name Employee Does, and maybe you get the names through discovery, and maybe not.  In any event, I've come to believe that you have to draw the line between reality and Law and Order someplace. Many times, these cases are just frivolous and make it more difficult for consumer attorneys to be taken seriously.

While "person" generally means an individual or a corporate entity under the FCRA, see 15 U.S.C. § 1681a(b), a cause of action for obtaining a consumer report under false pretenses or knowingly without a permissible purpose can only lie against a "natural person." 15 U.S.C. § 1681n(a)(1)(B). Burghy v. Dayton Racquet Club, Inc., 695 F. Supp. 2d 689 (S.D. Ohio 2010).

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8 hours ago, nascar said:

If an attorney named the credit union as a defendant, knowing you had no cause of action against it under 1692n(a)(1)(B), I would expect a sanction motion from defense counsel. I suppose you could also go after credit union on 1692n(a)(1)(A) for your $100 bucks and name Employee Does, and maybe you get the names through discovery, and maybe not.  In any event, I've come to believe that you have to draw the line between reality and Law and Order someplace. Many times, these cases are just frivolous and make it more difficult for consumer attorneys to be taken seriously.

While "person" generally means an individual or a corporate entity under the FCRA, see 15 U.S.C. § 1681a(b), a cause of action for obtaining a consumer report under false pretenses or knowingly without a permissible purpose can only lie against a "natural person." 15 U.S.C. § 1681n(a)(1)(B). Burghy v. Dayton Racquet Club, Inc., 695 F. Supp. 2d 689 (S.D. Ohio 2010).

The cause of action would be under 1681b, and you would definitely have a cause of action against the credit union.  The only question would be a matter of award.  Given the "natual person" language, the statutory award would not apply, but they are still liable for actual damages and attorney fees.  There may also be state consumer laws that apply to a business who is violating a federal statute.

This mess is why I always use arbitration for these types of cases where it matters much less. Unfortunately that is not available to the Op.

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