Collection Agency Gave Me A Farewell Gift

Hi Paul,

  I have a question regarding when a hard inquiry is allowed. 

  I have been cleaning up my credit for the past two years.  I paid the final debt, which was with a collection agency.  I checked my credit and saw that they did a hard inquiry on my credit the day before I paid them.  Is this hard inquiry legal?  If not, what action can I take against them.

  I have never seen a hard inquiry done unless I was applying for a new line/extension of credit and gave my permission.  All other creditors, collection companies and companies that I have accounts with have done soft inquiries. 

  I know they can check my credit because the account was sold to them, but it does not make sense that they would be allowed to do a hard inquiry without express permission.  If this was allowed, then anyone’s bank, insurance company, etc. could do hard inquiries anytime they felt like it and really screw up someone’s credit.

Can you help with a definite answer on this issue?

Courtney

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Hey Courtney,

Sadly, collection agencies have a permissible purpose.

Smithers!

Thanks for the questions.

Paul