Latisha is shopping for a car and an auto loan to purchase the car. All of the following statements are true, except: If Latisha applies for credit at multiple auto lenders for the same amount within the same week, most credit scoring models will treat this as one credit application. All of these answer statements are exceptions. Latisha should avoid shopping for the lowest auto loan interest rate possible, because multiple credit applications will cause her credit score to go lower, leading to a higher interest rate. Latish should shop around at different lenders to find the best loan terms possible for her auto loan.

If Latisha applies for credit at multiple auto lenders for the same amount within the same week, most credit scoring models will treat this as one credit application.

Explanation:

If you apply for multiple credits during the same week, each credit will be considered an independent credit application by the three credit agencies (Equifax, Experian, and TransUnion). Credit rating agencies have been around for several years, Equifax has been around since 1899, so they already know all the tricks that borrowers can even imagine. Probably several years ago before computers were extremely common, you could trick a credit rating agency by applying to several credits at the same time, but nowadays everything is online and connected, so you are wasting your time and hurting your credit record.

nikitavidya0 nikitavidya0 · Answer 2 · 2022-03-19T05:13:08+01:00

If Latisha applies for credit at multiple auto lenders for the same amount within the same week, most credit scoring models will treat this as one credit application is an incorrect statement.

What are credit scoring models?

Credit score models tend to analyze the risk and creditworthiness of individuals applying for credit cards or loans. In the case of digital connections all data of customers are interconnected which gives the probability of customers' default.

Therefore, when a person would apply for many credit cards in three different agencies in one week then it would be regarded as three different applications.

Learn more about credit card scores here:

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