DEFINITION of 'Account Inquiry'

An account inquiry is a review of any type of account, whether it be a depository account or credit account. The inquiry can refer to past records, payments or other specific transactions, or any other entries relating to the account.

BREAKING DOWN 'Account Inquiry'

Most financial institutions have a formal department that deals with account inquiries. Sometimes the term is used when there is a request to or from a credit agency about a particular consumer.

An account inquiry could be done per the request of a bank, lender, or other financial institution that requires a copy of an account history when an individual, business, or other entity applies for credit or a loan. Credit agencies may issue account inquiries to credit card companies or other lenders as part of assessing whether they are current on the bills they are responsible for.

Why Account Inquiries Are Performed

Account inquiry may typically be initiated when an individual seeks to take on new debt, particularly in conjunction with making a substantial purchase such as the acquisition of real estate. Before the individual us approved for the new debt, the lender wants to see the track record of the applicant when it comes to paying their debts in an orderly fashion. This is a step in assessing the overall creditworthiness of a potential borrower, as well as structuring the rates they may be offered for the loan they are seeking.

An account holder may initiate an account inquiry themselves, particularly if questionable activity is suspected. For instance, if there are debits that the account holder does not recall authorizing, an inquiry can provide answers to where the charges originate from. This could be a step in identifying security breaches or instances of fraud by bringing to attention to transactions that are not familiar. The account holder could request that bank or creditor launch an investigation into such transactions.

Account inquiries might also be made to ensure that payments that are owed have cleared and were delivered on time.

Excessive account inquiries by third parties, particularly for credit cards, may have an adverse effect on the credit rating of an individual. If an individual applies for multiple credit cards in a short period of time, each application will usually trigger an account inquiry into their payment history.

When those inquiries are reported to credit agencies, it may be regarded as a form of high risk and a cause to lower the consumer’s credit score.

  1. Credit Inquiry

    A credit inquiry is a request by an institution for credit report ...
  2. Appreciative Inquiry

    Definition of appreciative inquiry
  3. Primary Account Holder

    A primary account holder is the individual who is legally responsible ...
  4. Credit History

    Credit history refers to the ongoing documentation of an individual's ...
  5. Account Activity

    Account activity generically applies to whenever a movement of ...
  6. Account Statement

    An account statement is a periodic summary of account activity ...
Related Articles
  1. Managing Wealth

    5 Common Misconceptions About Your Credit Report

    Your credit report is one of the most important factors in determining your ability to get loans and new credit and has a major influence on your rates.
  2. Personal Finance

    5 Surprising Things That Will Hurt Your Credit Score

    Here are five ways that you can damage your credit score without even knowing it.
  3. Personal Finance

    Common Things That Improve And Lower Credit Scores

    Credit scores are used by lenders to estimate credit risk. Find out how you can better earn the trust of lenders and reap the benefits.
  4. Tech

    NY Attorney General Launches Inquiry into Cryptocurrency Exchanges

    New York Attorney General Eric Schneiderman announces an inquiry into cryptocurrency exchanges.
  5. Personal Finance

    Credit Repair: How to Improve Your Credit Score

    There is no quick fix for a bad credit score, but there are several strategies you can take to improve your credit rating and save money over the long term.
  6. Personal Finance

    Why Too Many Credit Cards Can Hurt Your Credit Score

    Find out why having too many credit card accounts can adversely impact your credit score if the cards are not managed properly.
  7. Managing Wealth

    12 Things You Don’t Know About Your Credit Report

    A good credit score is essential to securing a mortgage, obtaining a car, and getting other types of loans. But do you know what's on your credit report?
  8. Personal Finance

    Should you increase your credit card limit?

    Understand the fundamentals between credit scores, credit card limit, and your credit utilization rate. Find out why you should ask for your credit limit increase and the benefits that follow.
  9. Personal Finance

    The 5 Best Alternatives to Bank Saving Accounts

    Find out about some of the most profitable available alternatives to depositing money in a traditional bank passbook savings account.
Trading Center